The US business community expects the new government in India to come out with very strong governance agenda and outline what is its vision for reforms as the country could emerge as a "global bright spot" amidst the US-China trade war, the president of a top business advocacy group has said.
"With the vast amount of global capital that is right now looking at many different economies and feeling some fragility and some precariousness, India could look like the global bright spot, if you have a government coming in with a strong mandate and you have a vision of strong reform, then all of the sudden you start to see a lot more investment flowing towards India, the former Assistant Secretary of State for South and Central Asia said in an interview.
She said the US corporate sector is interested in seeing what kind of mandate the new government has.
"One thing that I am watching on is do we have a new government that has a robust mandate? What is that mandate? Is that a mandate to jump-start the economy, to boost reforms and to really grow significant opportunity for the people of India, for India's economic and standing in the world, as well as India's strategic standing in the world, she said.
In an apparent reference to the growing trade tension between the United States and China, Biswal said this moment could present tremendous opportunity for India and also present a significant challenge for the country.
A recent escalation in the US-China trade conflict, including tariff hikes from both sides, has sparked reaction from industries hit by the higher levies.
US President Donald Trump increased tariffs on USD 200 billion worth of Chinese imports into the US from 10 per cent to 25 per cent earlier this month, after Washington and Beijing failed to reach a deal on trade.
China retaliated by announcing plans to raise levies on USD 60 billion of US imports from June 1.
Noting that the current US-China standoff is looking "increasingly complex and increasingly protracted", Biswal said there are some fundamental questions that are being asked on the direction that China is moving.
She said Bejing's actions were giving not just the United States but many countries and global industry in general, some significant concerns about what it means for long-term security as well as long term economic potential.
"While we continue to push for a open trading system that does not impose tariffs in either direction and we continue to push very hard for global trade to flow freely including with China, which is a very important economic partner for India and for the United States, there is some increasing concern that US-China trade tension is pointing to some underlying concerns, she said.
"India could be a very significant beneficiary, if India were able to address some of those underlying concerns. One is as you start thinking about an over reliance for manufacturing supply chains on China, what is it India can do to really help broaden and diversify that?
"How can India build a supply chain ecosystem that brings in manufacturing, that brings in supply chain logistics and that really benefits from a infusion of global investment into the Indian economy, into Indian infrastructure, Biswal said in response to a question.
The challenge is that, India itself is a very complex ecosystem to navigate and it's both managing central and the state framework for regulation, for permitting and licensing, managing a overlay of different elements of the government and or bureaucracy having different perspectives on an issue, and how do you create a streamlined and coherent process, she observed.
"I think those are all things that are very manageable and doable for a new government coming in; particularly if it comes in with a strong mandate for government," Biswal said.
She said the US business community expects the new government to come out with very strong governance agenda and outline what that vision for reform, what that vision for transformation is.
Referring to the results of the exit polls, almost all of whom have given majority seat to the ruling NDA coalition, Biswal said if it is a return of Prime Minister Narendra Modi with a robust mandate, then he knows exactly how to create the kind of momentum and energy that will bring investor confidence, not just a from within India, but frankly from around the world.
"Global capital is looking to see where what the bright spots are and where it can find opportunity. India could be that significant opportunity for the world and a driver of global growth, Biswal said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)