A Lemoyne College professor and native of India believes his country is ready to remove some regulatory barriers to spur much needed foreign investment. President Obama pledged 4 billion dollars in investments and loans to facilitate U.S. trade with India. Management professor Bernard Arogyaswamy says it could forge stronger ties and help India become a more formidable economic power.
"China started modernizing about 35 years ago and India was left behind in that race until the mid 1990's almost. India is trying to catch up and its way behind in manufacturing and does need manufacturing investment."
Arogyaswamy says prime minister Narendra Modi is working to relax numerous and onerous regulations that have discouraged foreign investment in the past, something he had previous success with on the state level. The professor says Modi has become a savvy national leader on a global stage.
"He is sensing that China's influence is resented by the rest of southeast Asia. He is trying to get into a partnership with the United States, which India has resisted for the last 40 years. Mr. Modi has to make it a little easier to invest there and guarantee returns and it will flood in there because China is becoming less and less attractive."
Arogyaswamy says India is positioned for a higher pace of return than China, but he says working against India is its outdated and sometimes unreliable infrastructure. The professor goes on to say that India's roads, telecommunications, ports, airports and even electrical service are far behind China's and could give potential investors pause.
While economic growth is important, Arogyaswamy was Modi has his hands full with political and social concerns. The professor says religion and human rights might impact the conversation on investment.
