Obama looks for economic opportunity in India, Asia (Feature)

Nov 3, 2010, 17:21 GMT

By Mike McCarthy, dpa =

Washington (dpa) - US President Barack Obama's visit to India on the first stop of his Asia tour underscores the added importance of the relationship between the two countries at a time when the struggling US economy is looking for opportunities to grow.

Obama was to leave the United States only days after his Democratic party suffered a huge setback in midterm elections, due largely to voter anger over high unemployment and the slow pace of the economic recovery. Voters backed Republicans, ousted Democrats from control of the House of Representatives and trimmed their Senate majority to a narrow margin.

So as Obama heads abroad at a time of political trouble at home, the White House was emphasizing the important role India and its import market of more than a billion people can play domestically in the United States by creating jobs, economic growth and investment.

'India is in many ways fundamental to his economic message and has been for many years,' White House spokesman Robert Gibbs said. 'I think we'll see as we get closer not just the genuine potential of the market for American companies, but some tangible impact in supporting and creating jobs here in America.'

Obama is set to arrive in India on Saturday for a three-day visit - the longest to a single country so far in his presidency - before heading to Indonesia, South Korea and Japan. Economics will be the main focus of his agenda during the entire trip, aides said.

Obama will be looking for ways to tap into Indonesia's economic potential while reaching out to the world's most-populous Muslim nation, aides said. Obama has a special relationship with Indonesia as he spent part of his childhood there, but cancelled two previously planned trips to focus on a crucial health care bill and April's oil spill in the Gulf of Mexico.

In South Korea he will attend the G20 summit of the emerging and industrial economies ahead of joining the Asia-Pacific Economic Cooperation summit in Japan.

India's 1.2 billion people and an economy expected to grow at eight per cent over the next several years makes it 'a potentially very important market for US exports,' said Mike Froman, a senior White House advisor for global economic affairs.

US exports of goods to India have quadrupled over the last seven years to 17 billion dollars annually, while service oriented exports have tripled to 10 billion dollars per year, Froman said. Indian companies are the second fastest growing foreign investors in the United States and support about 57,000 US jobs, he added.

India emerged as a cornerstone of US foreign policy in South Asia in the early 2000s, as then-president George W Bush's administration cast aside decades of frosty Cold War relations to pursue closer ties with the world's most-populous democracy, in part to help counter China's burgeoning influence on the continent.

Central to the new relationship was a nuclear cooperation agreement that was finalized shortly before Bush left office and after years of negotiations complicated by India's refusal to join the nuclear Non-Proliferation Treaty. The deal allows US firms to participate in the lucrative development of Indian nuclear energy to help it meet its growing thirst for electricity.

Obama has sought to capitalize on the warm relations Bush ushered in with India and build on the progress. Obama hosted his first state dinner - a pomp and circumstance event designed to place the highest honour on a foreign leader - for Indian Prime Minister Manmohan Singh in November 2009.

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