[Congressional Record (Bound Edition), Volume 145 (1999), Part 7]
[House]
[Page 9395]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 9395]]

                 STRENGTHENING U.S.-INDIA ECONOMIC TIES

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from New Jersey (Mr. Pallone) is recognized for 5 minutes.

  Mr. PALLONE. Mr. Speaker, the recent disputes between the United 
States and India over nuclear and missile testing issues have not only 
resulted in political and diplomatic setbacks in our bilateral 
relationship. One of the major casualties of this year of antagonism 
has been the economic relationship between our two countries.
  The historic free-market economic reforms that India initiated at the 
beginning of this decade have created vast opportunities for American 
participation in India's economic future. India's huge middle class 
represents a significant market, while India's infrastructure 
development needs offer opportunities for cooperation that will benefit 
both countries.
  Unfortunately, Mr. Speaker, this past year has seen us lose some of 
the momentum of the previous 6 or 7 years. I am hoping to contribute to 
putting the U.S.-India economic relationship back on track, and I would 
like to offer some ideas on how we can do that.
  Today I am introducing legislation to suspend all of the unilateral 
sanctions that the United States has imposed on India. Last year, 
Members of Congress, working on a bipartisan basis, approved a 
provision in the fiscal year 1999 Omnibus Appropriations bill that gave 
President Clinton authority to waive the sanctions during the fiscal 
year. But I think that a more permanent and less discretionary approach 
is now necessary.
  There are some other legislative initiatives being proposed in this 
body and in the other body, the Senate; and this progress is 
encouraging, although some of the proposals may not go far enough.
  My bill is drafted in such a way as to remove the current 
discretionary approach for waiving sanctions on a selective basis or an 
exchange for certain concessions by India. In a response to a letter I 
sent him earlier this year, President Clinton indicated that his 
administration will pursue an incremental approach to lifting sanctions 
in exchange for nonproliferation steps by India. But I do not think 
that this is the way to go.
  I have been calling for months for a U.S. policy that turns away from 
the current stance of confrontation with India and towards recognition 
of India's legitimate security needs and the prospects for greater 
Indo-U.S. cooperation in both strategic and economic areas. 
Negotiations over our disagreements concerning nuclear issues should 
not destroy the burgeoning economic relations between America and 
India.
  I am not only pushing for this legislation because of my concerns for 
how the sanctions impact on the people of India, although that is 
extremely important to me. As a U.S. Congressman, I am concerned that 
the remaining sanctions are causing American companies to lose 
opportunities to do business in India, while our economic competitors 
in Europe and Japan gain a major foothold in this great, emerging 
market.
  Mr. Speaker, India is the fifth largest economy in the world. The 
private sector accounts for 75 percent of GDP. The country has 22 stock 
exchanges, over 9,000 listed companies, as well as the commercial 
banking network of over 63,000 branches. It has had stable democratic 
government since 1947. It has an independent judicial system and 
positive foreign investment policies. There is a skilled work force, 
including professional and managerial personnel. English is, of course, 
the preferred language for business and is spoken widely and fluently.
  During a recent congressional delegation visit to India, the 
leadership of the Confederation of Indian Industry, considered to be 
India's major business organization, presented a wish list to radically 
improve our economic ties. Foremost on the list was, of course, the 
lifting of the sanctions.
  CII's newly installed president has called on India's government to 
speedily approve economic reform legislation.
  Prime Minister Atal Behari Vajpayee currently leads a caretaker 
government, and new parliamentary elections are not scheduled until 
September. But the caretaker government is empowered to push through 11 
key pieces of economic legislation that have been introduced in 
Parliament and vetted by the relevant committees. They include bills 
governing insurance regulatory authority, money laundering and foreign 
exchange management, securities contract and export/import. CII is also 
calling for reform in 19 key sectors of the economy, ranging from the 
financial sector and capital markets, to infrastructure and 
agriculture, to continued privatization.
  It is clear that the leaders of India's private sector are intent on 
promoting an improved climate for trade and investment and are 
encouraging their government to do everything possible to achieve this.
  I have spoken with many American business leaders, and it is clear 
that the U.S. business community is concerned about improving 
relations, and that lifting the sanctions is also on the top of their 
list.
  Mr. Speaker, we must finally get beyond the unproductive approach of 
confrontation and work towards policies that will promote improved 
opportunities for cooperation between the world's two largest 
democracies. I hope that the legislation I am introducing today will 
contribute to that process.

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