WASHINGTON (Reuters) - India’s external affairs minister, S.M. Krishna, on Tuesday sought to reassure frustrated U.S. business leaders that India is committed to economic reforms, after recent government decisions that have left them questioning future investments.
“In an era of global interdependence, not everything is within the powers of national governments. But we are confident we will restore investor confidence and regain momentum and growth,” Krishna said in a speech to a business group ahead of a meeting on Wednesday with U.S. Secretary of State Hillary Clinton.
Regulatory uncertainty and policy gridlock have battered foreign corporate sentiment toward India, adding to a dramatic slowdown in the Asia democracy’s economic growth and exacerbating a widening current account deficit that has knocked the rupee to record lows.
Speaking shortly before Krishna, White House international affairs adviser Michael Froman said U.S. companies have grown increasingly “concerned about the economic relationship, fearing that the investment environment (in India) has deteriorated.”
In recent months, global business groups have raised concerns that new policies in India on technology purchases would unfairly discriminate against foreign firms. Proposed changes in Indian tax provisions have also sparked criticism and warnings that investment plans by overseas companies could be reconsidered.
Reporting By Doug Palmer; Editing by Leslie Adler