INDO-US TRADE RELATIONS
AND COOPERATION ON ENERGY SECURITY AND CLIMATE CHANGE
Remarks
Consul General Henry V. Jardine
38^th Annual General Convention of Indo-American Chamber of Commerce (IACC)
Kolkata, November 8, 2007

November 08, 2007

Principal Secretary Commerce & Industry, Dr. Sabyasachi Sen
Regional President, Eastern India Council of IACC, Mr. S K Jain
Regional President-Elect of IACC, Mr. Sutanu Ghosh

Distinguished guests, ladies and gentlemen, I want to congratulate the Eastern India Council of the Indo-American Chamber of Commerce on the occasion of its thirty-eighth Annual General Convention.  This past year was a very busy and successful time for the IACC, with a string of high level visits and initiatives and as always, we at the U.S. Consulate sought to work in close cooperation with the IACC and its members.

I want to thank Mr. Jain for his great leadership and drive this past year.  He was personally instrumental in the very constructive visit of the Union Minister for Food Processing Industries Shri Subodh Kant Sahai to the United States as well as in pushing for a Special Economic Zone (SEZ) for food processing here in West Bengal.  He also implemented a very fruitful tie-up with the Rhode Island World Trade Center.

Mr.  Jain and the IACC were also very supportive of our work in the region by hosting visits of Charge’ d’Affaires Mr. Geoffrey Pyatt and Mr. Steven White, Minister Counselor for Consular Affairs Mr. Peter Kaestner and Assistant Secretary for Consular Affairs Ambassador Maura Harty. 

As the Indian economy continues to surge ahead in recording new highs in trade and investment flows into and out of the country – its engagement with the U.S. too is witnessing all-time expansion, with a 20 percent increase of Indian exports to the U.S. and a 30 percent increase of U.S. exports to India in 2006.  Recent data (August) indicates that U.S. exports to India have increased by 66 percent this year and Indian exports to the U.S. have increased by 9 percent.  Clearly, we are witnessing a continued trend of healthy growth. 

In another indication of this strong trade relationship, the U.S. Commercial Service is also experiencing an unprecedented boom.  In FY2007, our export success performance measure increased by 250 percent, which attests to the surge in demand from U.S. companies wanting to do business in this region. 

We expect the strong demand to continue.  In early 2008, we have the following events planned -- the Commercial Service will plan close coordination with IACC on all these events and encourages participation from as many members as possible:

            -     Renewable Energy Trade Mission from January 13-15 led by A/S for

                   Market Access and Compliance David Bohigian

            -      Entrepreneurial Symposium led by A/S Bohigian, January 15

            -      USA Pavilion at the IME (International Mining, Exploration Mineral

                    Processing Technology & Machinery Exhibition) January 17-20

            -      FedEx Trade Mission, February 5-7

            -      Los Angeles Trade Mission, March 8-9

In addition, we have sought to facilitate greater Indo-U.S. business contacts by enhancing our consular services.  Our consular section experienced rapid increase in visa demand with an approximately 27 percent increase in applications in 2007 over the number of applications in 2006.  To respond to this demand and to provide quick and timely service to the business community, we have added an additional consular officer, hired more local staff and have improved our access and waiting areas.  As a result, visa interview appointments are available within three days and we can provide immediate appointments if required for emergencies.

The U.S. has been India's largest investor for many years, but flows hovered for years around a modest average of $400 million annually.  Now, American investment is growing by 50 per cent per year - to nearly $900 million in FY07.  Another point to note is that, historically, portfolio investment or Foreign Institutional Investment (FII) has vastly outstripped Foreign Direct Investment (FDI).  But in FY07, FDI beat FII, reflecting investors' growing confidence in India's long-term future, rather than the attractions of current high valuations.

Demonstrating the two way nature of Indo-U.S. economic engagement, the U.S. has long been one of the largest recipients of Indian investment, receiving roughly one-fifth of India's investments abroad.  Indian investment in the U.S. is now spreading from an IT focus into other sectors, including pharmaceuticals and manufacturing, such as the Mahindra’s tractor factories in the U.S.

As US and India continue to deepen their bilateral trade and investment relations, both countries realize that for sustainable economic growth, we need to cooperate closely to meet both our increased energy needs and effectively tackle associated challenges, including those related to air pollution, energy security, and greenhouse gas intensities.

On May 31, 2007, President Bush laid out an ambitious and forward-looking strategy to help the world establish a new framework on greenhouse gas emissions when the Kyoto Protocol expires in 2012.

President Bush's proposal addresses the challenge of climate change while not sacrificing the imperative of economic growth.  The U.S. will work with major emitters of greenhouse gases and energy consumers, in an effort to develop a long-term global emissions goal.  The plan will be based on the principle that climate change must be addressed in concert with energy security and economic growth, and underpinned by the adoption of clean energy technologies. 

We are engaged in innovative multilateral solutions to the dangers posed by harmful greenhouse emissions and are by far the largest donor for activities under the United National Framework Convention on Climate Change and the Intergovernmental Panel on Climate Change – whose seminal work to understand the connection between human activities and global warming, under the able leadership of Dr R K Pachauri has been recognized with a Nobel Prize this year.

India and the United States have looked to leverage new clean technologies to address climate change issues.  To date, this cooperation has occurred within the multilateral framework known as the Asia Pacific Partnership on Clean Development and Climate.

Established in 2005, the Asia Pacific Partnership on Clean Development and Climate (APP) is an innovative multilateral effort to accelerate the development and deployment of commercially viable clean technology to promote sustainable development and poverty reduction.  The partner countries - the United States, India, China, Korea, Japan, Australia -- represent about half of the world's economy, population, energy use, and emissions, and produce about 65 percent of the world's coal, 48 percent of the world's steel, 37 percent of world's aluminum, and 61 percent of the world's cement.  

In October 2007, Canada joined the partnership and working together, these seven countries aim to develop practical solutions to tackle the challenge of energy security.  In the past fiscal year, the US has contributed US$45 million in funds that support the projects and activities of the Partnership.  For more information on the Partnership, its achievements till date and the projects it supports, you may like to visit www.asiapacificpartnership.org

The APP is also about trade.  Our Department of Commerce recently held an APP trade mission which will lead to millions of dollars of investment in these countries.  A 2008 reverse trade mission of Indian renewable energy companies to the US is expected to result in US$12 million in clean technology trade and investment in US.                              

The US is pursuing various policy approaches to significantly increase market penetration of renewable technologies.  These efforts could lead to installation of up to 50 GW of renewable energy between now and 2020.  As part of the President's 20 in 10 Plan – i.e. reducing gasoline consumption by 20 percent in ten years, we have introduced legislation requiring the use of 35 billion gallons of alternative fuels in 2017.  We expect to see our partners work together to support diffusion of these technologies.  Our Department of Energy and Environmental Protection Agency are working on low-cost and no-cost efficiency improvements in buildings that can increase efficiency by 10-15%, which leads directly to major cost savings and profit. 

In West Bengal, we work closely with the West Bengal Renewable Energy Development Agency (WBREDA) on environment projects. Working with WBREDA, USAID and an American company has recently demonstrated the feasibility of using micro turbine technology fuelled by biogas as a clean, decentralized energy option, through a successful pilot project at a dairy farm in Purulia.  Efforts are now being made to disseminate information about this technology so that it can be replicated in several projects across India.  

The USAID is also planning to support WBREDA to open a Regional Energy Efficiency Center on Home Appliances in Kolkata.

Later this year, the US Consulate will be hosting a coastal management expert for a few weeks, who will work with local government bodies and NGOs on climate change issues affecting the Sunderbans region.

In discussing our work in consular, commercial and even environmental areas, I wanted to reflect the depth and extent of the very important Indo-U.S. commercial relationship and to relate how we at the consulate, in conjunction with the IACC, have worked to further these links.  I want to again thank Mr. Jain for his excellent work this past year and congratulate him on becoming a national IACC Vice President.   I also want to congratulate Sutanu Ghosh on his new position as the Eastern Region IACC President.  I know that we at the consulate look forward to another productive year with the IACC under Sutanu’s leadership.

Thank you.