Modi promises unlimited India economic reforms

Prime Minister Narendra Modi promised “truly unlimited” reforms Sunday in his bid to transform India’s economy into a global powerhouse as he showcased his fiefdom to global political and business leaders.

Speaking at a major investment summit in the western state of Gujarat attended by US Secretary of State John Kerry, UN chief Ban Ki-moon and World Bank supremo Jim Yong Kim, Modi hailed India as a “land of opportunities” for business.

Modi was Gujarat chief minister for 13 years before leading his Bharatiya Janata Party to national power last May, and much of his electoral appeal centred around his economic stewardship of the coastal state.

The presence of Kerry and Kim is seen as a vote of confidence in Modi’s efforts to replicate his local success and kickstart growth in Asia’s third-largest economy.

Kim predicted Modi’s government was on the verge of lifting millions of Indians out of poverty, while Kerry said the world’s two largest democracies could make huge strides together.

Modi said his right-wing government had already introduced a slew of initiatives since ending a decade of rule by the left-leaning Congress.

“In a very short span of seven months, we have been able to change the atmosphere of despair and uncertainty,” he told the “Vibrant Gujarat” conference.

“My government is committed to create a policy environment that is predictable, transparent and fair.”

But Modi said he was also planning further reforms and development to revive India’s flagging economy, which has been struggling through the worst slowdown in decades, without specifying details.

– ‘Quantum leap’ –

“The process of development we are taking up is not incremental. We are planning to take a quantum leap. It is not limited to one sector or region, it is truly unlimited,” he said.

Under Congress, investors frequently complained about a hostile business climate in India, frustrated by bureaucracy and corruption.

India slipped two places down the World Bank’s ease of doing business rankings last year to 142 out of 189 countries.

In contrast, Gujarat won a reputation as India’s most investor-friendly state during the era of ‘Modi-nomics’ — even if critics say he favoured big business through tax breaks and subsidies.

Kerry told the gathering the US is looking forward to stronger trade and diplomatic ties with India, with American companies primed for more investment.

“I can’t think of a moment in all my years in public life when our destinies are converging as significantly as they are today,” said Kerry, who is to visit a Ford auto plant in Gujarat.

“This is a relationship where we believe we can turn sustainable growth into opportunities we have not seen before,” Kerry said ahead of bilateral talks with Modi.

Kerry’s visit comes a fortnight before US President Barack Obama is due to visit New Delhi as Washington seeks to warm up sometimes frosty ties.

It is only a year since Washington ended a de facto boycott of Modi, who was blacklisted following deadly communal riots in Gujarat in 2002.

Modi received a rapturous reception from members of the diaspora on a visit to the US last autumn and a string of Indian-origin bosses were in Gujarat.

– Indian ‘bright spot’ –

India’s richest man Mukesh Ambani said his Reliance Industries would invest one trillion rupees ($16 billion) in the country over the next 18 months.

Rio Tinto chief Sam Walsh also flagged two projects by the mining giant — a $2 billion iron ore investment in the state of Orissa and a diamond project in Madhya Pradesh to employ 30,000 people.

At the opening session, World Bank president Kim forecast India’s growth would hit 6.4 percent this year and even faster next.

“We project that India will be a bright spot in an otherwise mediocre global economic outlook,” he told the summit.

He said Modi must press on with reforms, including slashing red tape and simplifying taxation by introducing a national goods and services tax.

UN chief Ban also urged India to work hard to battle climate change by boosting energy efficiency and sustainable growth.

“India should come out with an ambitious target to cut down carbon emissions,” he said.

As well as simplifying labour rules, Modi has made manufacturing a priority of his premiership, echoing his time in Gujarat.

In his summit address, he promoted his ‘Make in India’ campaign launched in September to fire up a manufacturing sector that lags behind rival China.

He also reiterated commitments to so-called ‘smart cities’ and better infrastructure, including high-speed rail networks and industrial corridors.

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