US tech giants like Google and Facebook announcing big investments in India shows that people are losing trust in China and India is emerging as a big competitor, a top economic advisor to President Donald Trump said on Thursday.
Larry Kudlow, White House Economic Advisor, talking to reporters here, said that with the slashing of corporate taxes, India could be a very attractive investment place.
“I think it (investment of US companies in India) is interesting. Just a moment on India. I have been to a couple of bilateral meetings with the (Indian) leaders. What (does) that tell you? People are losing trust in China and India becomes a big competitor,” Kudlow said. The top economic advisor to Trump was responding to a question on a series of investments being announced by major American companies like Google, Facebook, Amazon and Walmart running into billions of dollars in various Indian companies.
Google chief executive Sundar Pichai on Monday announced plans to invest Rs 75,000 crore in India over the next five to seven years to help accelerate the adoption of digital technologies in the country.
The investment follows commitments made by other US tech majors Facebook and Amazon, earlier this year. The US and China are at loggerheads over several issues, including the coronavirus and China’s implementation of a controversial security law for Hong Kong.
The Trump administration blames China for not warning the world of the coronavirus pandemic earlier and hiding the extent of its outbreak. Beijing has rejected the allegations.
The US has also lambasted China for suppressing the freedom of Hong Kong, a semi-autonomous Chinese territory that has a special trading relationship with America, by implementing the national security law which allows Beijing to tighten its grip over the former British colony.
“If I’m not mistaken, India has slashed its corporate tax rate. I know that was my recommendation to Prime Minister Narendra Modi, when I met him 18 months ago. So, it (India) may be a very attractive investment place and he is a great ally of the US,” Kudlow said. In a major concession to industry, the Centre last year slashed the corporate income tax rate for new companies in the manufacturing sector to 15 per cent. For existing companies, the rate has been brought down to 22 per cent. However, Kudlow cautioned against India continuing to be a “very protectionist” country. “We are not opposed to international commerce. Those are great American companies. Good luck with India. India is a great country. President Trump is very friendly (with India). He was with Prime Minister Modi. It’s also very unfortunately, very protectionist country. So I’ll just wish them (US companies) luck. But a lot of population,” Kudlow said in response to a question.