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US Ambassador to India Nancy Powell’s resignation on Monday is viewed by many in the Indian industry as the US Government’s timely step to replace her with a person who is more friendlier towards Gujarat Chief Minister Narendra Modi, who many feel, could be the next Prime Minister of India. Powell, it has been reported, was not too keen on re-establishing ties with Modi who the US Government recently reached out to, after keeping at a distance for almost nine years since the Gujarat riots. Powell met Modi on February 13 following instructions from Washington ending the boycott.
“It shows that the US is keen to maintain its robust trade and diplomatic relations with India no matter who is in power,” a representative from an industry chamber told Business Line .
“It was clear that Powell could not continue as the Ambassador to India if Modi became the Prime Minister. But, replacing her at that time would have been too obvious a move and resulted in embarrassment for the US. So, the US had to act now,” another Indian industry chamber representative said. General elections in India begin on April 7. The results are scheduled on May 16. Narendra Modi, the Bharatiya Janta Party’s Prime Ministerial candidate, is expected to benefit from the anti-incumbency factor working against the Congress-led UPA Government that has been in power for the last 10 years. “There have been some tensions on a number of trade and intellectual property issues recently with the US, but both countries realise the importance of maintaining long-term cordial relations. The US Ambassador Nancy Powell’s resignation is a clear example of this,” the first business representative said.
India-US merchandise trade has been growing rapidly over the last decade. Bilateral trade touched $67 billion in 2013, making the US the third largest trading partner for India. The US is also one of the largest foreign direct investors in the country accounting for over 8 per cent of FDI inflow.
Some bureaucrats, however, feel that Powell’s insensitive handling of the diplomatic row over arrest of Indian diplomat Devyani Khobragade in New York was a more pressing reason that led to her resignation.
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