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US urges India to move to 8-10% growth rate

US has said it is important for India to move on to higher annual growth rate of 8-10 per cent and felt that the forthcoming World Trade Organisation ministerial meeting at Doha, Qatar in November, provided an opportunity to push up India's exports by taking measures to reduce trade barriers.

Addressing the US-India Business Council, US Undersecretary of State for Economic, Business and Agricultural Affairs Alan Larson urged both countries to work together to build "innovative economies" where knowledge and technology were constantly expanded to generate higher productivity.

Larson emphasised that both India and the US needed high and sustained rates of economic growth in order to reach their national goals.

New Delhi, he said, needed growth rates of 8 to 10 per cent annually in order to lift hundreds of millions of its citizens out of poverty and Washington needed rates of economic growth of around 4 per cent annually "in order to educate our children and provide health care and income security for an ageing population."

He also listed the characteristics of innovative economies as, rich human capital based on an educated work force, intellectual property rights and protection, regulatory systems that encourage competition and openness to international trade and foreign investment.

Larson said India had made "significant but unsteady progress in dismantling trade protectionism during the past decade, but more needs to be done."

He said the ministerial meeting of WTO in Qatar provided India an opportunity to lay a foundation for an innovative export-oriented economy, adding it would benefit it in the reduction of its own barriers and will put its economy on a more competitive, export-oriented footing.

Reduced trade barriers in India and other countries around the world will stimulate a new surge of international capital investment flows, he said.

In human capital, he said, India had important strengths, including a world-class cadre of software engineers and an institutional support system to promote co-operation and develop information technology talent.

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