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US decision affecting Indians unjustified: CII

New Delhi: Indian industry on Wednesday voiced serious concern over the US decision to extend hiked visa fees and impose additional taxes that will impact Indian companies, saying such "unjustified" protectionist steps are making the environment difficult there for businesses of this country.

In a statement issued here, business chamber CII hoped that the US would revise its stance on targeting Indian companies, especially given the increasing volume of investments and jobs they are creating for the US economy.

"CII is deeply concerned over the rising costs and increasingly terse business environment for Indian companies operating in the US, particularly in the pharmaceutical and IT sphere," said the statement issued by CII Director General Chandrajit Banerjee.

The Industry body referred to the new US Health Bill that provides for imposition of two per cent excise duty on goods and services imported by the US government from countries, like India and China, which are outside the purview of WTO`s Agreement on Government Procurement and said it "unfairly" targets foreign companies to pay for domestic imperatives which is "unjustified".

Quoting "several critics", it said the provisions in the bill amount to "absurdity" as it would be akin to India requiring US companies to pay for healthcare compensation of victims of the 26/11 terrorist attacks in Mumbai.

The CII was also critical of the US government decision to extend the hiked visa fees under the Border Security Bill that would impact Indian professionals.

"The provisions clearly go against the Indian companies," Banerjee said.

US President Barack Obama signed the James Zadroga 9/11 Health and Compensation Act on January 3, which provides compensation for treatment of victims of 9/11 terrorist attacks.

The estimated budget (USD 4.2 billion) will be funded by continuation of an increased fee on certain categories of H-1B and L1 visas up to 2015. In August, the visa fee hike, under the US Border Security provisions, was valid till 2014.

The move would mainly impact Indian IT companies, which earn about 60 per cent of there USD 50 billion revenue from exports to America.

Banerjee said that apart from internal laws, the US has also been a strong proponent of the Anti-Counterfeiting Trade Agreement (ACTA).

Under ACTA, the border and customs authorities can seize goods "suspected" of violating intellectual property related laws, even if such goods are in transit to another destination where they may be acceptable.

The CII DG said that in the last two years, there has been a "barrage of protectionist measures" proposed and enacted against foreign companies like measures restricting iron and steel imports in the American Recovery Act, Ohio`s ban on offshoring projects, among various others.

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