Speeches & Remarks
OFFICIAL TEXT
February 21, 2012
Remarks by Under Secretary Francisco Sánchez
Madras Chamber of Commerce and Industry Seminar on Indo-U.S. Partnership in the Indian Port And Maritime Sector
CHENNAI: Good morning. I greatly appreciate that warm welcome. Thank you for hosting our U.S. delegation today.
In particular — allow me to thank Mr. Shivaraman for that kind introduction; for his welcoming remarks; and for his tremendous leadership and service.
I’d also like to recognize the Union Minister for Shipping for joining us today. Your participation and — more importantly — your friendship means a great deal.
Finally — on behalf of the U.S. delegation — I want to thank the Madras Chamber of Commerce and Industry for organizing this seminar.
MCCI has earned itself quite a reputation over the years. Ever since that day 176 years ago… when 18 businessmen came together and decided to put the common interest before their self interest by forming this organization… MCCI has done tremendous things.
It’s been instrumental in the growth of South India. It’s provided opportunities: for people; for businesses; and for communities. And, it’s an honor to be here today to identify ways we can work together to shape the next 176 years.
As many of you know — I’m here leading our first-ever ports and maritime trade mission to India. I’m joined by 12 U.S. companies who produce some of the world’s best products and services in this field.
And even though we’ve only been in Chennai for a short period — we are having a great time. We’re enjoying the culture and the people. And, we’re excited about the possibilities for partnership.
Here in Chennai — and across South India — we’ve seen the great progress that has occurred. We’ve seen the great potential of the area.
But, we’ve also seen its great needs — particularly in regards to infrastructure. As we all know — India is on the rise. Its economy has opened up. Its middle class is booming.
Annual growth rates of 8 to 10 percent are now common. And in the long-term — according to Morgan Stanley — India will grow faster than any other large country over the next 20 to 25 years.
Obviously these are great developments for the people of India. But, this growth also poses some challenges.
As MCCI officials have said in the past —- the prosperity of a country often depends on the health of its infrastructure.
Particularly its transportation infrastructure. Customers need to be able to get to stores in order to shop. People need to be able to get to work. Businesses need to be able to ship their goods efficiently.
Unfortunately — India’s infrastructure isn’t keeping pace with its growth.
And, that means that India isn’t as competitive as it could be.
Certainly, commercial relations between our two countries are hindered by this reality. In 2011 — bilateral trade in merchandise goods between India and the United States was nearly $58 billion dollars. This is up from roughly $49 billion in 2010.
And this increase is clearly a good thing. But, I think you’ll agree that there is potential to do so much more. And one of the obstacles holding us back is the insufficient infrastructure along the coastline.
Indian ports have experienced growing traffic in recent years. But while activity has increased — capacity has not. This results in congestion at ports. This means costly delays. This means lost opportunities.
Just take a look at the numbers. Coastal shipping accounts for roughly 40 percent of trade volumes in the US, China and Europe.
Meanwhile — it represents only 7 percent of India’s total domestic cargo transport network.
Clearly investment is needed to address these challenges. I understand that the government is encouraging private sector participation in port development.
And I was also glad to see last year’s announcement to commit $66 billion for the port sector … and $27 billion for the shipping sector.
This will reportedly increase India’s port capacity from 1 billion tons to 3.2 billion tons by 2020.
We in the United States support this effort: One — because it will strengthen our trade relationship. And two — because it provides a great opportunity for us to come together to create economic growth.
We want to be a part of India’s economic development. We want to help it reach its goals. We want to be a part of this expansion effort.
The 12 U.S. companies I’m with are specialized port-related equipment suppliers and service providers. I encourage you all to meet with them individually.
They offer products and services that would greatly enhance India’s coastal infrastructure. They have done great work in America — and all over the world — building communities and generating economic activity.
They can do the same here — in partnership with the Indian public and private sector. This is work that would benefit both our economies — supporting jobs and businesses.
And, this conversation today is an important step towards reaching this goal. That’s why we made it a priority to come here this morning.
We know that the Union Minister will offer: great insight into Indian federal policy initiatives; and into opportunities in the maritime and port sector.
So today — we are eager to listen. Today — we’re eager to learn. But tomorrow — we want to partner. We want to collaborate.
We want to build infrastructure with you. We want to build stronger commercial ties with you. And we want to work together to build a more prosperous future for both our countries.
So, I look forward to our conversation today.
And I thank all those with the Madras Chamber of Commerce and Industry for the opportunity to join you this morning.
Thank you very much.