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Reform doubts grow as India's Modi marks year in office
By Bhuvan BAGGA
New Delhi (AFP) May 14, 2015

Indian PM meets China's Xi on home ground
Beijing (AFP) May 14, 2015 - Chinese President Xi Jinping welcomed Indian Prime Minister Narendra Modi to his ancestral home province Thursday, highlighting ancient ties as the Asian giants reportedly discussed a simmering border dispute.

Attempting to put their relationship on a more personal footing, Xi met his visitor in Xian, the capital of Shaanxi province, telling him it was "the first time I have treated a foreign leader in my hometown", China's official news agency Xinhua said.

Modi, who was beginning a three-day visit, said it was "an honour to 125 crore (1.25 billion) Indians whom I am representing as Prime Minister", according to India's PTI agency.

The choice of venue was seen as reciprocation after Modi hosted Xi in his home state of Gujarat last year.

But ties between the world's two most populous countries have long been strained over a Himalayan border dispute that saw the two nations fight a brief, bloody war in 1962.

"Boundary issues were discussed including peace and tranquillity on the border," Indian foreign secretary S. Jaishankar told reporters following the summit.

He said the two also discussed India's attempt to join China as a permanent member of the United Nations' elite Security Council, which Beijing has avoided directly endorsing.

Both are members of the BRICS grouping of major emerging economies, but are jockeying for influence in Asia.

Beijing has vowed to pour investment into India's arch-rival Pakistan, as it rolls out plans to boost infrastructure across Asia which seem to mostly bypass India.

Chinese contracts to build or manage Indian Ocean ports have raised concerns it is seeking to establish a "string of pearls" in the region.

China is India's biggest trading partner with two-way commerce totalling $71 billion in 2014. But India's trade deficit with China has soared from just $1 billion in 2001-02 to more than $38 billion last year, Indian figures show.

The Indian leader will later head to the capital Beijing and China's financial hub Shanghai, seeking to deliver on election promises to attract foreign investment for India's crumbling rail and other infrastructure.

Modi led his Hindu nationalist Bharatiya Janata Party to a crushing electoral victory last May on a promise to revive India's flagging economic fortunes.

- Terracotta Warriors -

Xian is a former capital of China in Imperial times, and earlier Thursday, Modi inspected the emblematic Terracotta Warriors, pictures on his official Twitter account showed.

"The Terracotta Army is a heritage of the world," images on the social media network showed his comments in the visitors' book as reading. "It is a testimony to China's civilisational achievements."

He also toured the Daxingshan Temple, where Indian scholars are said to have translated Buddhist sutras into Chinese following its construction during the Western Jin Dynasty (265-316 AD).

Ahead of his trip, Modi said he firmly believed "this visit to China will strengthen the stability, development and prosperity of Asia".

"I am confident my visit will lay the foundation for further enhancing economic co-operation with China in a wide range of sectors," he wrote on Twitter last week.

But his overtures have met with a mixed response in China.

Earlier this week an op-ed in the Global Times, affiliated with Communist Party mouthpiece the People's Daily, accused him of "playing little tricks over border disputes and security issues".

Writer Hu Zhiyong added that few Indians were able to understand Sino-Indian relations, due to "the inferiority of its ordinary people".

After China, Modi will head to Mongolia and South Korea.

Narendra Modi marks the first anniversary of his landslide election win in a bullish mood about his mission to transform India into a great power, despite doubts about the delivery of economic reforms.

A year on from his victory, the prime minister's domestic opponents are in disarray while the one-time pariah has won the respect of international peers.

But while the economy is purring along, siren voices say the delay in implementing key reforms points to trouble ahead while murmurings about his intolerance of dissent grow louder.

Hartosh Singh Bal, political editor of current affairs magazine Caravan, told AFP "the mood certainly remains upbeat on the economy".

But he added: "We've heard slogans... we have yet to see how that will translate on the ground."

After winning the first outright majority by any leader in three decades on May 16, 2014, Modi vowed "to make the 21st century India's century" and turn it into a driver of the global economy.

"You will actually see that, internationally, the whole world is, once again, excited about India and enthusiastic about India and the opportunities that India represents," he told Time magazine this month.

Figures show India's economy growing faster than China's with the IMF predicting expansion of 7.5 percent this year.

Even if smaller firms are more circumspect, big business has glowed over Modi's pledges to slash bureaucracy, streamline the tax regime and make it easier to acquire farm land.

Foreign companies, which have long despaired at levels of taxation and corruption, have welcomed his drive to make India a manufacturing hub.

Sceptics, however, say the growth rate and a fall in inflation owe more to a recalculation of data and a fall in oil prices than government policy.

They also point out that the land bill and a national goods and service tax aimed at unifying myriad levies are struggling to get through parliament.

Manoj Joshi of the Delhi-based Observer Research Foundation agreed the buoyant mood might not last.

"The economy is doing well... so one can't quibble with that," he said.

"Yet of course there are concerns that unless and until there are structural reforms -- and that's another key element of Modi's policy -- we will not be able to sustain it."

- 'Chilling effect' -

While ascendant over the enfeebled Congress party in the lower house of parliament, Modi's Bharatiya Janata Party (BJP) is in the minority in the upper house, which has blocked several bills.

The limits of what supporters call "Modi Magic" were exposed when the BJP was wiped out in Delhi's state elections in February, trounced by a fledgling anti-corruption party.

Although his personal ratings have largely held up, the Delhi result was a reminder of Modi's polarising nature.

Muslims remain wary of the Hindu nationalist who first came to international prominence when communal violence killed hundreds in Gujarat in 2002, when he was the state's chief minister.

His failure to speak out against calls by a BJP lawmaker for Hindu women to have more children to "protect" their religion has caused some dismay. And there was also unease at his delay in condemning attacks on churches.

The 2002 violence saw Modi shunned by the United States and European Union until it became clear he could become premier.

The warm reception he has received on his travels to Washington, Berlin and Paris has therefore been striking.

His first visit this week to Beijing represents a different kind of challenge as India and China jostle for Asian pre-eminence while also trying to make common cause on trade.

His invitation to South Asia's leaders to his inauguration signalled his intention to reclaim the mantle of the sub-continent's champion even if ties with Pakistan remain chilly.

"Somewhat surprisingly for a former chief minister with no prior executive experience in New Delhi, Modi has turned out to be unusually gifted at diplomacy," Sadanand Dhume of the Washington-based American Enterprise Institute told AFP.

US President Barack Obama, Modi's guest in January, has spoken of his admiration for the premier's journey from his days helping his father sell tea, saying it reflects India's potential.

But Obama's visit ended with a warning against India splintering along religious lines, while the US ambassador to India has bemoaned the "chilling effect" of a crackdown on NGOs.

Caravan's Bal said the squeeze on campaign groups such as Greenpeace pointed to a wider intolerance by Modi, who has also taken swipes at elements of the media and judiciary.

Few would accuse the prime minister of lacking energy in his first year. Tales abound of civil servants, fearful of getting on Modi's wrong side, sleeping overnight in their offices and working weekends.

"The nation's mood and confidence has been restored," said Mukhtar Abbas Naqvi, a long-time confidant who is now a minister.

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