Passage of Bankruptcy Code good for business in India: US official

Government’s latest success in passing of the New Bankruptcy Code has been applauded by the US officials too; stating that the move coupled with American tax authorities accepting bilateral advance pricing agreements (APA), will lead to US industry finding 'to do business' in India much easier. On May 12, the Rajya Sabha passed the Insolvency and Bankruptcy Code 2016, which the US believes will make it easier for American companies to do more business in India.

Director General, US and Foreign Commercial Service, and Assistant Secretary, Global Markets, US Department of Commerce Arun M Kumar said that “Many US companies are increasingly optimistic about the shift in tone, but are waiting to see further tangible progress in India’s business climate. Even as some states have moved swiftly up the rankings, India still ranks lowest among the G20 countries on the World Bank’s 2016 Doing Business report.”

He further added that to enhance its position in global supply chains and deepen its integration with the world economy, India will need to harmonise product standards with international rules. Standards barriers - such as certain testing, certification, and registration requirements - not only pose obstacles to US companies, but hamper the pace of India’s integration into the global economy.

He acknowledged India's e-commerce market as the fastest growing in the world and said that over the last two years, US businesses invested over $15 billion in India, and will reportedly sign deals worth another $27 billion over the next two years. However, according to him a high-standard Bilateral Investment Treaty (BIT) will help augment big-ticket investments from US into India. Recently India and the US held technical-level talks at the Finance Ministry on BIT.