U.S. explores working with India to extend financial competitors in opposition to China, says Commerce Secretary Gina Raimondo

WASHINGTON — Commerce Secretary Gina Raimondo mentioned Wednesday that the U.S. is contemplating collaborating with India on sure manufacturing jobs to be able to enhance competitors in opposition to China.

Raimondo instructed Jim Cramer on CNBC’s “Mad Cash” that she’s going to go to India in March with a handful of U.S. CEOs to debate an alliance between the 2 nations on manufacturing semiconductor chips. The Commerce Secretary additionally revisited a few of President Joe Biden’s feedback on American manufacturing from his State of the Union deal with on Tuesday.

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“We stopped making issues,” Raimondo mentioned. “I feel, in 1990, there have been like 350,000 folks working within the chip business in America. Now it is like 160,000.”

Biden’s CHIPS and Science Act, signed into legislation in August, equipped $52 billion for U.S. firms to put money into chip manufacturing. The U.S. semiconductor business employed greater than 277,000 staff in 2021, in accordance with the Semiconductor Trade Affiliation, nevertheless it made 0% of the world’s provide of semiconductors as of September 2022.

Compared, Taiwan and South Korea comprise 80% of the worldwide foundry marketplace for chips. TSMC, the world’s most superior chipmaker, can also be headquartered in Taiwan. However a collaborative effort between the U.S. and the Indo-Pacific “quad” area might reduce the worldwide reliance on Taiwanese semiconductors. In September 2021, India, Japan and Australia introduced plans to ascertain a semiconductor provide chain initiative to safe entry to semiconductors and their elements.

Raimondo mentioned that India is “making a number of the precise strikes.”

“It is a big inhabitants. (A) lot of staff, expert staff, English audio system, a democratic nation rule of legislation,” she mentioned.

However the Commerce Secretary mentioned the southeast Asian nation should adjust to labor requirements as a part of any deal, particularly in gentle of India’s consumption of Russian oil. The G-7 nations, Australia and the European Union have issued worth caps on the price of Russian oil merchandise to limit the Kremlin’s entry to a possible funding supply for its struggle on Ukraine whereas nonetheless sustaining an oil provide on the worldwide market.

“I am working the Indo-Pacific financial framework,” Raimondo mentioned. “So now we have 13 nations together with India. And we’re saying to them, look, enroll on the government-to-government stage to labor requirements, environmental requirements, anti-corruption requirements, rule of legislation requirements. And in return, it’s going to unlock U.S. enterprise, U.S. capital jobs in India.”

Raimondo additionally mentioned she helps reinvesting the cash from Biden’s 1% excise tax on inventory buybacks for giant companies into the economic system. Buybacks attraction to a few of the nation’s largest traders and companies.

“I am strongly with the President that we ought to lift taxes on the wealthiest and on companies shut some loopholes and take that cash and make investments,” she mentioned. “You need girls to return to work? Childcare (has to) be offered, it is too costly. So, we have to increase taxes in some methods after which make investments to make the economic system stronger.”