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Silicon Valley Hits At India Over Trade

Bruce T. Brown | Stone | Getty Images

A lobby group representing US technology companies is set to attack India for its domestic procurement policies at a congressional hearing Wednesday, in a sign of growing concern among multinationals about market access in the south Asian nation.

Dean Garfield, president of the Information Technology Industry Council, which lobbies for large Silicon Valley groups including Apple, Google, and Hewlett-Packard, will testify that India is pressing ahead with measures that will "undermine, if not outright dismantle" its own progress as a global power in the tech sector.

Mr Garfield's remarks to the House ways and means subcommittee on trade – which were obtained by the Financial Times – single out India's "preferential market access policy", or PMA, as its main source of complaint, since it would require the sourcing of IT products made in India in both the public and private sectors.

In addition, Mr Garfield will target India's decision to "stand on the sidelines" in plurilateral discussions within the World Trade Organisation over the expansion of the Information Technology Agreement.

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"While we certainly do not oppose India's objective to build a stronger manufacturing base, we do have concerns with some of the methods it has chosen," Mr Garfield will say. "These policies have put India crossways not just to the United States. They are also at odds with both the broader economic ideals shared among many global partners, and with the engines of India's own emergence on the global stage," he will add.

A senior executive from Pfizer, the US pharmaceuticals group, is also expected to testify Wednesday.

In announcing the hearing, Devin Nunes, the California Republican who chairs the panel, said the purpose of the session was to explore the promise of the growing US-India trade relationship, but also its trouble spots.

"I am concerned that India has launched a series of alarming policies that harm US job creators and are counterproductive," Mr Nunes said. "I intend to push India to remove barriers that prevent US companies, farmers, ranchers, and workers from competing on a level playing field and selling their world-class products and services to India's 1.2bn consumers."

(Read More: India Declares, We're Back in Business)

The tone of the hearing reflects the mounting disapproval across US business of Indian government policies, which they say are removing opportunities for market access in a similar vein to complaints about China's industrial policies.

US-India trade relations have also seen an increase in disputes at the WTO over the past two years. The US last month launched a trade complaint against India over its national solar programme.

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