India on brink of "quantum leap", Modi

tells investors

1 OF 6. Prime Minister Narendra Modi (2nd L) shakes hands with U.S. Secretary of
State John Kerry at the Vibrant Gujarat Summit in Gandhinagar in Gujarat January 11,
2015.
BY RUPAM JAIN NAIR AND AMAN SHAH-GANDHINAGAR Sun Jan 11,
2015
(Reuters) - Prime Minister Narendra Modi promised on Sunday to pursue predictable
policies and ensure stable taxes, in a speech that sought to address concerns for foreign
investors in Asia's third-largest economy.

U.S. Secretary of State John Kerry led a roll call of leaders, including U.N. Secretary
General Ban Ki-moon and World Bank head Jim Yong Kim, converging on Modi's
home town of Gandhinagar for the Vibrant Gujarat business summit.

U.S. President Barack Obama visits India later this month.

Eight months into Modi's rule, his failure to lift the economy from its longest growth
slowdown in a generation has raised questions about how much substance there is
behind his promise of "red carpet, not red tape".

"We're trying to complete the circle of economic reforms speedily," Modi told the event
that he founded when he was chief minister of the industrial state.

"We are also keen to see that our policies are predictable. We're clear that our tax
regime should be stable," Modi said, speaking in English but making the occasional
aside in Hindi.

Along with speakers from Japan, Canada and Singapore, Kerry praised his host and
avoided direct criticism. But he hinted at the need to cut back India's stifling
bureaucracy.

"We no longer live in a world where a country is going to be competitive if its

bureaucracy sends people from door to door and window to window and meeting to
meeting," he said.

PROMISED DEALS

Modi spoke on Sunday of the achievements he hopes will help lift hundreds of millions
of Indians out of poverty, including the opening of more than 100 million bank
accounts, a 'Make in India' campaign to promote manufacturing, and plans to expand
the rail, road, energy and digital networks.

"We are planning to take a quantum leap," the 64-year-old leader said.

Among the deals announced was a $4 billion agreement between U.S.-based solar
power firm SunEdison and Indian conglomerate Adani Enterprises, to build one of
India's largest solar panel makers.

Vibrant Gujarat, held every two years, has yielded billions of dollars in investment
promises, though only a fraction of the deals announced have come to fruition.

Modi aims to lift stagnant capital investment that has held back India's growth to 5.3
percent. That is expected to accelerate this year to 6.4 percent, said the World Bank's
Kim, who called India a "bright spot" in a mediocre global landscape.

Mukesh Ambani, India's richest man with a fortune estimated at $19.7 billion, said
hisReliance Industries conglomerate would invest 1 trillion rupees ($16 billion) in
Gujarat over the next year to 18 months.

Sam Walsh, CEO of global mining giant Rio Tinto, flagged two potential projects
including a $2 bln iron ore project in Odisha state. Woodside Petroleum (WPL.AX)
CEO Peter Coleman, whose firm signed an agreement with Adani to explore sourcing
and marketing of liquefied natural gas, said there were fiscal improvements to be
made, though also potential.

"Is India open for business? We believe it is," he said.

Modi has made headway on making it easier for outsiders to invest more in real estate,
insurance and defence, but a rigid labour market and rotten infrastructure are huge
deterrents.

India slipped to 142nd out of 189 in the World Bank's latest Doing Business Index.
Modi wants India in the top 50.

"Investors want credibility, stability and at the same time flexibility. Right now, India
is a bit of an inflexible market," said Kilbinder Dosanjh, a director for Asia at Eurasia
Group, a geopolitical risk consultancy.

($1 = 62.3450 rupees)

(Additional reporting by Arshad Mohammed; Writing by Douglas Busvine and Clara

Ferreira Marques,; Editing by Angus MacSwan)
Posted by Thavam