Obama expresses investment fears in India

US President Barack Obama has indicated the need for India to implement reforms for job creations and to ward off stagnation in investment.

In an interview to PTI, Obama cited the concerns of the American business community to make his point.

"Many in the American business community have expressed concerns that the investment climate in India is unfavourable. They tell us it is still too hard to invest in India. In too many sectors, such as retail, India limits or prohibits the foreign investment that is necessary to create jobs in both our countries, and which is necessary for India to continue to grow," Obama said.

Lauding India's growth worldwide even in difficult times, he said, "Indian innovation is an engine of the global economy. And even with the recent challenges, the Indian economy continues to grow at an impressive rate. The Indian people have displayed a remarkable capacity to meet India's challenges.”

"There appears to be a growing consensus in India that the time may be right for another wave of economic reforms to make India more competitive in the global economy," he added.

Talking of the effect of global economic crisis on growth rate of India while pledging support to India in its implementation of difficult and necessary reforms, Obama said, "it is not the place of the United States to tell other nations, including India, how to chart its economic future. That is for Indians to decide."

Describing Prime Minister Manmohan Singh as his "friend and partner" with whom he had worked closely, Obama said he valued the insights of the Indian leader at various international fora including the recent G20 meeting in Mexico.

At G20 summit, Obama had said that one of the best things the member countries could do to bring global economy back on growth path was to renew the focus on growth and job creation in their own countries.

"That's my priority in the US. Of course, one of the most effective ways we can create jobs is to continue expanding trade and investment, including between the US and India," he had said.

India reacts

Obama’s remarks about the investment scenario in India have united the political leadership of the country. The ruling Congress-led United Progressive Alliance (UPA) government at the Centre and Opossition Bharatiya Janata Party-led National Democratic Alliance (NDA), as also Left and regional parties, expressed strong displeasure at Obama's statement.

Minister of Corporate Affairs Veerappa Moily said Obama was ill informed of India's strong economic fundamentals.

Sensing a larger conspiracy, Moily said that “certain international lobbies are spreading these kind of words.”

Congress leader Harish Rawat said that “we cannot do things to impress another country or their economy, but we will take decisions to fulfil the needs of our own economy.”

Similarly, Opposition parties ridiculed Obama’s remarks and said the Government should not come under any pressure and refrain from relying on "prescription offered by others."

“They want to open up our economy and market on their terms. For this purpose, they are creating this pressure.... as it is, no one believes that under the present situation, there will be any sea change in the investment scenario world over,” Communist Party of India (Marxist) leader Nilotpal Basu reacted.

BJP described Obama’s remarks as “laughable” and said “that country is giving us a certificate on investment and economy when it itself is facing economic problems. We have to ensure our national interests on our own. It is laughable.”

BJP and the Left have opposed Foreign Direct Investment (FDI), especially in retail citing interests of the small trader.

“If Obama wants FDI in retail and India does not want, then it won’t happen just because he is demanding it,” former finance minister and veteran BJP leader Yashwant Sinha said.

“The US only wants its market to expand in our country,” Samajwadi Party (SP) leader Shahid Siddiqui said.

No comments:

Post a Comment