Confederation of Indian Industry High Tea
Fred P. Hochberg
Jan 30, 2013 – Mumbai, India
I come from America, a country founded by people who got lost on their way to India - then tried to cover up their mistake.
After Christopher Columbus crossed the Atlantic and landed in America in 1492 - he decided that was good enough.
What did he do?
He promptly called the people who lived there Indians - and the islands in the Caribbean became the West Indies.
And of course the locals had no idea in the world what he was talking about.
Well, I do know the way here - this is my sixth visit to India - and I am not allowed to have favorites, but India is at the top of my list.
I was just here 18 months ago with Secretary of State Hillary Clinton, as part of the India-U.S. Security Dialogue.
And I was here the year before, as well, with President Barack Obama when we signed a $5 billion memorandum of understanding with Reliance Power.
I've been here every single year I have been Chairman of Ex-Im, and sometimes more than once!
In fact, Ex-Im was present during the early years of the Republic of India - providing loans for emergency food aid.More important, we provided financing throughout the 1950s to equip industrial expansion and basic infrastructure.
Incidentally, we were involved even earlier when Tata Steel was expanding its production in the 1930s.
In other words, we have a long, long history together, working as economic partners.And your importance grows every year.
Last year, we[FH1] financed 17 percent of all U.S. exports to India.
Today, India is in a virtual tie with Mexico for number one in Ex-Im's financings - and we have every expectation that you will take a solid lead in short order.
Our financing in India covered a broad swath of your economy - oil and gas development, renewable energy production, manufacturing, information and communications, and commercial aircraft to serve the boom in air travel.
India is in a hurry.
Your middle class is growing by millions of people every year - building on the vast number of Indians under the age of 35.
There are now about 800 million Indians under 35 - two-thirds of the population.
These 800 million are - or will be - available for work in offices, factories, construction sites and other businesses.
This is a tremendous opportunity for India's future prosperity, and a key reason why many predict that you will have the world's third largest economy by 2030[FH2].
What will propel that growth?
Jobs, lots, of them, in fact between as many as 650,000 to 850,000 new jobs - every month -- to keep pace with this population growth.
It means massive, unprecedented investments for infrastructure from transportation and electrical power to sanitary sewer and water systems.
India's current five-year plan calls for spending one trillion US dollars ($1,006 trillion) by 2017 for this infrastructure - doubling what was spent in the last five years.
Public-Private Partnerships or PPP's are central to the success of this plan.
And that is where we at Ex-Im come in.
We're an independent US agency established in 1934 by President Franklin Roosevelt.
Our mission is simple, to provide financing to overseas buyers of U.S. products and services - and to create U.S. jobs, along with jobs in the importing countries.
We provide competitive, market-rate financing when the private sector is either unwilling or unable to do this.We help insure that when India or Indian companies want to buy U.S. goods that the financing is there.
We offer three basic financing products - insurance, guarantees, and loans.
These help Indian entrepreneurs gain access to world-class technology and services that already are making the Indian economy more productive, cost-effective and inclusive - and avoid future inefficiencies and bottlenecks that lead to widespread inflation.
Rather than describe each product, let me give you some examples of how we work with Indian companies.
There's no better example of a large project than Reliance Industries' Jamnagar refinery and petrochemical complex - the largest corporate industrial project in the nation's history.
In 2007, we approved a $500 million loan guarantee to help finance a new refinery at the site.
Citibank was the guaranteed lender.
This 12 year loan helped pay for design and engineering services, as well as state-of-the-art technology and equipment to produce high-quality fuels[FH3] and petrochemicals.
We followed the next year with another $400 million long-term loan guarantee to support Reliance's onshore and offshore oil and gas exploration and production.
This was all part of a larger $2-1/2 billion Indian Infrastructure Finance Facility created by Ex-Im that year.
The new refinery took three years to build, employing over 75,000 construction workers - and now includes a self-contained township for 2,500 employees and their families.
Just last month, Ex-Im Bank approved the financing of $2.1 billion to expand petrochemical production at Jamnagar.
Half the amount is a direct loan by Ex-Im, and the other half a guaranteed loan from JPMorgan Chase.
It too will create thousands of construction and operating jobs for Indians.
Projects such as Jamnagar are good for India and good for America.
They create and sustain jobs both here and in the US.
And they forge greater ties between our two countries.
At the other end of the scale, Ex-Im Bank helped finance two undertakings that are favorites of mine.
By approving a 15-year direct loan, we helped finance Azure Power, India's first megawatt-scale solar project, using thin-film solar panels[FH4] produced in Arizona.
Uniquely, the Azure project connects its solar projects to the national grid - benefitting more than 50,000 people and reducing India's carbon emissions by up to 5,500 metric tons per year.
Not only that, it supports some 600 local construction jobs and another 200 to operate the system.
American exporters will benefit, but the Indian economy will benefit even more in new jobs and new efficiencies.
The other example is Aquatech International Corp., founded by an Indian-American entrepreneur Venkee Sharma over three decades ago [in 1981].
I have the pleasure of knowing Venkee and his inspiring success in America.With his hard work, talent, ambition and, lately - our financing - his company now exports innovative water technology throughout the world, including an Indian subsidiary.
I had the pleasure of visiting one of their installations in Mahabalipuram - probably the only American tourist there that day as excited about the water treatment system as I was at viewing the extraordinary art and architecture.
Venkee Sharma and Aquatech point up something very important and underappreciated - the close personal, not just business, ties between the U.S. and India.
Our 2010 census counted over three million Indian Americans - an increase of nearly 70 percent in ten years.
They have succeeded in virtually every field of endeavor in America - including being elected governor of two of our 50 states.
In fact, Indian-Americans are the highest-income, most-educated and fastest-growing ethnic group in American today.
They also maintain close ties to their homeland in a virtuous circle of trade, investment, migration and return, and cultural exchange.
There's perhaps no better example of how commerce and trade can draw people together.
Venkee Sharma illustrates Ex-Im Bank's special emphasis on financing suited to the needs of U.S. small businesses to begin or expand exporting.
He also illustrates something else - that Ex-Im not only helps our entrepreneurs.
Because our small exporters tend to partner with small businesses overseas, they help diversify and expand small businesses in India and other countries - creating a more sustainable economy for everyone
We are also in full support of India's National Solar Mission - and the world leadership you are showing with that bold initiative.
It and other initiatives have already produced several major renewables projects of all sizes, ranging from solar thermal facilities to wind turbine farms[FH5] to take advantage of India's abundant sunshine and wind.
This is also part of our U.S.-India Partnership to Advance Clean Energy to help accelerate India's progress for low-carbon economic growth[FH6].
As President Obama declared in his Inaugural Address last week, we cannot ignore the threat to our planet from global warming.We will work with you to make your progress even more of a reality.
More important, we can expect the plan to generate an array of creative proposals, drawing on the best efforts of Indian entrepreneurs and engineers.
The broader need for infrastructure is obvious and visible.India's planners wisely have made this a central priority in the current five-year plan.Besides electricity, these include:
·A million miles of new paved roads and bridges,
·4,600 miles of new subways and metros,
·Expanded telecommunication networks businesses can rely on,
·Airports, seaports, oil and gas pipelines,
·And billions of dollars' worth of capital goods and services like construction and mining equipment - and engineering and architecture.
U.S. exporters and the Ex-Im Bank stand ready to help meet these needs.
But most important to you, these underscore the potential for job creation in India - whether the jobs are at Reliance's huge petrochemical complex in Jamnagar or small solar systems in rural areas.
The 75,000 construction workers who expanded the Jamnagar refinery in the last decade represented 75,000 families supported - 75,000 families in the middle class - 75,000 more skilled workers helping to build India's 21st century economy.
When all is said and done, that is why we work so hard to build and expand our businesses.
I've been here enough times to see firsthand the energy and wisdom of your business leadership - and the results prove this.
I look forward this week to many more discussions and more partnerships between our two dynamic countries.Let's do business.