Major US dailies hail FDI decision

Leading dailies in the United States have described India’s decision to allow foreign direct investment (FDI) in multi-brand retail and aviation as “biggest economic reforms” in two decades, while apprehending these proposals pose a “big political risk” for the Prime Minister Manmohan Singh-led UPA government.

The New York Times said Singh’s Congress-led government was “under heavy pressure to kick-start India’s slowing economy, boost employment and improve the country’s shambolic infrastructure” and allowing major foreign brands like Walmart into the country was a step in that direction.

It said the decision to open the retail, aviation and broadcast sectors to foreign investment was ‘the biggest economic reforms in two decades’ but the plans will continue to stir controversy”.

The Washington Post said the reforms announced by Singh “are the biggest and toughest reforms since Manmohan Singh took over in 2004”.

Singh is taking a big political risk with the economic proposals, which could end up breaking up his governing coalition,” it said.

‘The Washington Post’, which had earlier this month described Singh as a “silent” prime minister and “dithering, ineffectual bureaucrat presiding over a deeply corrupt government”, said the reforms announced by the him “are the biggest and toughest reforms since Manmohan Singh took over in 2004”.

“After being on the defensive for two years over slowing economic growth, high inflation and growing corruption, the coalition government finally appeared determined to make tough decisions this week,” The Post said.

‘The Wall Street Journal’ described the reforms as “a dramatic push to reverse the nation’s economic decline and boost capital flows from overseas”.

It said “resistance to the measures is likely to be fierce, and even if they stick, foreign investment won’t necessarily flood in”.

“Still, the steps have the potential to open the door significantly wider for foreign companies looking to capitalise on India's vast consumer market,” it added.