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US to focus on export, innovation, investment in 2011

Press Trust of India  |  Washington 

The Obama administration, as part of its efforts to revive the US economy, would focus on areas of export, innovation and investment in 2011, said a White House official.

"I think the focus has got to be on investment, on exports, and on innovation... Rather than excessive consumption and housing investment, as it was in the last boom (time)."

"I think the President's firmly planted in that camp, and we're going to grow our way out of this," said Austin Goolsbee, Chair Council of Economic Advisers in an interview to ABC on Sunday.

In all the three areas of export, innovation and investment, the Obama Administration is looking at India for playing a major role, which was evident during the November visit of the US President to India.

A study by Ernst & Young, which was commissioned by the Federation of Indian Chambers of Commerce and Industry (FICCI), found that Indian companies have increased their investment in the US by more than $20 billion over the past five years.

According to the study, those investments have supported the creation of more than 65,000 American jobs.

"That number got even higher when President Obama visited India in November. At the president's summit with Prime Minister Manmohan Singh, US business leaders signed export deals with India worth more than $10 billion," said NASSCOM chief Som Mittal in an op-ed in The Seattle Times.

"President Obama estimated those contracts would create 50,000 American jobs — many in the Seattle area — in the near future, proof that America's expanding economic partnership with India is far from a one-way street," he said.

The study also revealed increasing percentage of India's outward-directed investment towards the US; in the past two fiscal years alone, roughly 20 per cent of overseas acquisitions made by Indian companies' were in the US.

During 2009 and 2010, Indian companies made 536 foreign acquisitions, 105 of which were in the US.

Further, during the quarter that ended in June this year, Indian companies completed 101 outbound acquisitions of which nearly a quarter were American firms.

According to the study, information technology was the fastest-growing area of outbound investment, followed by manufacturing and pharmaceuticals.

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First Published: Mon, January 03 2011. 13:20 IST