US Business Questions PM Modi's Reform Credentials Ahead of Visit

The US business lobby on Thursday questioned the reformist credentials of Prime Minister Narendra Modi on the eve of his visit to the United States in which he will encourage investment and declare India open for business.

The U.S. Chamber of Commerce and 15 other US business associations representing sectors ranging from agriculture to movie making, pharmaceuticals and telecoms, called on President Barack Obama to press Mr Modi to remove barriers to fair trade when the two leaders meet in Washington on Monday and Tuesday.

"Since taking office, Prime Minister Modi has declared India 'open for business' and promised to incentivize investment and 'give the world a favorable opportunity to trade with and produce in India,'" the Alliance for Fair Trade with India said in a letter to Mr Obama.

"Thus far, however, the new Indian government has produced troubling policies of its own," the group said, adding: "These actions send perplexing and contradictory new signals about India's role in the global marketplace."

There was no immediate comment from the Indian embassy in Washington on the letter from the U.S. business lobby.
Mr Modi is due to arrive in the United States on Friday for his first visit as prime minister and has meetings scheduled with 17 U.S. corporate chiefs including those of Google, IBM, GE, Goldman Sachs and Boeing.

Analysts say maintaining a positive mood will be important during the visit, given that Mr Modi was denied a U.S. visa in 2005 after more than 1,000 people, most of them Muslims, were killed in riots in Gujarat during his first term as the state's chief minister.

The letter highlighted India's blockage of a key World Trade Organization agreement reached in Bali last year, which overshadowed a recent visit to India by US Secretary of State John Kerry.

US officials say the United States will press Mr Modi to end the WTO blockage during his visit, something that could dampen the mood of a trip aimed at revitalizing a strategic relationship Washington sees as a key counterbalance in Asia to an increasingly assertive China.

Stephen Ezell, senior trade policy analyst at the Washington based Information Technology & Innovation Foundation, told a teleconference that  Mr Modi had taken some positive steps, including an easing of some restrictions on investment in the defense, insurance and railway sectors. "However ... we've also seen the continuation of existing - and even the promulgation of some new - trade-distorting policies that do give us some pause," he said.

Chris Moore, of the National Association of Manufacturers, said Mr Modi and his administration were "saying positive things."

"But their actions tell a different story," he said.