News / Asia

India Rejects Obama's Concerns About Investment Climate

People walk past an American apparel brand store in Bangalore, India, January 11, 2012.
People walk past an American apparel brand store in Bangalore, India, January 11, 2012.
Anjana Pasricha
NEW DELHI — Indian officials have rejected U.S. President Barack Obama's reported concerns that India's investment climate is deteriorating.  Officials in New Delhi are pushing back, saying India is friendly to foreign investors.

In an interview with the Press Trust of India Sunday, U.S. President Barack Obama said that in too many sectors, such as retail, India limits or prohibits foreign investment.  Indian Commerce Minister Anand Sharma responded to the American leader's comments a day later, saying “observations are observations.”

“There is a difference between perception and reality, reality is different," said Sharma. "India has an abiding commitment to economic reforms and liberalization. We would like to assure all our partners that we have an investor friendly climate.”

PTI quoted President Obama as saying that American businesses “tell us it is still too hard to invest in India.”

Obama praised the Indian economy, saying it is growing at an impressive rate. But he said there appears to be a growing consensus in India it may be the right time to press ahead with another wave of economic reforms.

Minister Sharma says the Indian government has put policies in place to welcome investors. “In all the global projections, if you look at the IMF [International Monetary Fund] and the World Bank reports, for the next three years also, India will remain one of the top three destinations attractive for investors,” he said.

Corporate Minister Veerappa Moily said President Obama is not properly informed and blamed “international lobbies” for spreading negative information about India.

Lawmakers from opposition parties also criticized the American president’s remarks.

President Obama’s observations have come in the wake of growing concerns expressed by many foreign and domestic investors about India’s failure to further liberalize its economy and about the hurdles posed by India’s regulatory framework.

During a visit to India last week, Singapore’s Prime Minister Lee Hsien Loong called India’s business environment “complicated.”

Some Indian officials agreed that there is need to make India's more business-friendly for outside investors.  

“I don't think we are taking any different view that we need to strengthen the investment climate,” said Montek Singh Ahluwalia who heads India’s Planning Commission.

In recent weeks, Indian Prime Minister Manmohan Singh too has spoken about the urgent need to take steps to boost foreign as well as local investment, which has been falling in recent months.

Analysts say Singh wants to take steps to move ahead with reforms in sectors such as retail and insurance, but opposition from political allies has made the task difficult.

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Comments
     
by: Randy R from: canada
July 17, 2012 10:17 AM
India should learn to take positive criticism.President Obama is right,even World bank and IMF rate india at the bottom when it comes to easy of doing business and investing in the country.

by: John from: German
July 17, 2012 12:01 AM
Actually, I prefer China rather than India.
Simple reason: the population in India is growing too fast to feed.

by: trish from: USA
July 16, 2012 5:46 PM
What the Indian officials and opposition leaders stated on the latter part of the article re: the necessity to make India more business-friendly is exactly what Mr. Obama was talking about. Yet they insisted Mr. O had to be wrong. They are starting to sound like our "ultra -right" Republicans that counter everything Mr. O prepares and/or gets through. Yet they have nothing better to replace these items with other than exactly what he put up there. Both groups seem to not what Mr. O to be right, before they are right. In other words, if it were they that put up the changes first, those same ones he was talking it about, all would be right with the world. No one can give credit where credit is due??? How egotistic!!!

by: K PURUSHOTHAMAN from: NOW IN WEST AFRICA
July 16, 2012 3:23 PM
INDIA HAS NOT REJECTED, INDIAN CIVIL SOCIETY, INDIA'S BUSINESS MINDS, PUBLIC GIVE CAREFUL ATTENTION TO COMMENTS ESPECIALLY OF GOOD ECONOMIES LIKE US.
IT IS THE POLITICIANS WHO REJECT OR OVER REACT TO ANY CRITICISM... FORGET ABOUT THEM... AS WE INDIANS TEND TO IGNORE THEM... INDIA IS GROWING BY GOD'S GRACE AND IN SPITE OF OUR POLICITIANS...

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