NEW DELHI: In what can be seen as an electrifying start to US Secretary of State Hillary Clinton’s visit to India, the US government-owned financial entity, Overseas Private Investment Corporation (OPIC) on Tuesday announced plans to invest up to $820 million (about `3,600 crore) in the renewable energy sector by the end of 2011, and the US Trade and Development Agency (USTDA) extended its commitment of over $1.4 million for two projects in India’s energy sector.
In a day that saw Clinton and External Affairs SM Krishna stating a mutual intent to pursue expansion of trade and investment ties in their Joint Statement, major announcements including a study grant for India’s funds-starved clean energy sector, the US side also articulated the American desire to participate in India’s infrastructure development story, an area that they have studiously ignored all this while.
However, Indian investments in the US have continued to grow by an annual 35 per cent during April-December 2010-11, creating thousands of jobs in America, while bilateral trade between India and the US crossed $30 billion during 2005-2009.
Recognising the potential for more, Clinton said, in the areas of trade and investment, the ties between the two countries are growing stronger and the US is proud to be one of India’s largest trading partners and direct investors. “We welcome India’s investment in the US, which is rapidly on the rise. This is a good news story—but we would be remiss if we didn’t strive to make it even better,” said the US leader.
Krishna agreed that there are extraordinary examples of India-US cooperation to harness the power of science, technology and innovation to address challenges in the realm of healthcare, education, environment, clean energy and agriculture.
Taking these ahead, the Joint Statement by the two leaders expressed the intent of the two governments to resume technical-level negotiations next month in Washington.
The two sides also intend to participate in the first Consular Dialogue on July 25 in Washington for a full discussion on visa and other consular matters.
“Investments totalling $ 820 million would be made in India’s renewable energy sector by the end of this year,” OPIC president and CEO Elizabeth Littlefield said at a round-table, organised by the US-India Business Council (USIBC), on supporting India’s infrastructure sector.
The USTDA will extend over $1.4 million for two projects in India’s energy sector, said its Director Leocadia I Zac.
The agency inked pacts with Astonfield Renewables Private Ltd and North Delhi Power Ltd for these proposed investments.
Minister of New and Renewable Energy Farooq Abdullah, who met with Deputy Secretary, US Department of Energy, Daniel B. Poneman, suggested cooperation in the integration of solar and wind energy, small grid and policy framework and called for extending the cooperation to new areas such as small hydro power, technology transfer and storage of renewable energy.
Besides energy, the Indian infrastructure sector is another area where American companies may be coaxed into exploring business opportunities. American companies have shied away from the infrastructure sector despite the $1 trillion investment opportunity during the 2012-17 period.
“Infrastructure is one area where Indian and US investors can work for mutual benefit,” admitted Robert D Hormats, US Under Secretary for Economic, Energy and Agricultural Affairs.
Fred Hochberg, Chairman of the US Export-Import Bank, who met with officials from the General Electric Company to discuss rail and energy projects, will also be meeting officials from the Infrastructure Development Finance Corporation (IDFC), the State Bank of India, Tata Capital, Citibank India and ICICI Bank to discuss EXIM’s role in financing infrastructrure projects and renewable energy.
Hochberg will also meet with Anil Ambani, Chairman, Reliance Power with whom EXIM had signed a $5 billion agreement for the purchase of US manufactured equipment for a 8000 MW project.