Washington, February 17:

Large emerging markets like India and China, which are turning into important engines of global growth, bear a special responsibility to take actions that enhance growth and stability, a senior US official said.

“Much of the global economy’s success is due to the positive effects of globalisation,” treasury undersecretary for International Affairs Tim Adams told the Asia Society in Houston as he related India’s great economic ‘success story’.

Globalisation has helped emerging markets like India and China to become increasingly important players and, in turn, “they bear an increasing responsibility to take actions that enhance growth and stability”, Adams said, according to the official text of his speech. Adams noted that US exports to India have doubled since 2000 and imports from India are up by 75 per cent. But he said India was still ‘quite restrictive’ about allowing foreign competition in its banking, securities and mutual funds industries.

“India now permits full foreign investment in a range of industries, including many manufacturing sectors and urban infrastructure, but it retains significant barriers in others, including retail trade and the financial sector,” he said.

In addition to further reducing trade and investment barriers, India should aim to liberalise its financial sector and to create a business environment that ensures contracts are met, taxes levied and paid fairly, he said. On a broader scale, he said since India, China and Brazil have grown so rapidly because of trade, they need to help the foundering Doha Round of world trade talks. “Large developing countries such as India, Brazil and China bear a special responsibility as major players in the world economy,” Adams said. “They need to contribute by substantially cutting their applied tariffs on agricultural and manufactured goods.”

He added that India’s tariff rates against imports remain ‘well above’ those in other developing countries.