Obama and Modi vow to improve trade, economic ties

US President Barack Obama and Indian Prime Minister Narendra Modi discussed the two countries' economic relationship, with Modi pressing Obama to make it easier for Indian services companies to reach US shores.

Obama praised Modi for addressing India's challenges since taking office in May, singling out in particular the prime minister's focus on "the needs of the poorest of the poor."

The pair said they discussed shared intelligence on terrorism and regional concerns such as Afghanistan, as well as clean energy, climate change, and the scientific push in India to improve sanitation and hygiene. They also swapped views on the rise of the Islamic State militant group, and the fight against Ebola in West Africa.

Modi also revealed he and Obama had a "candid" discussion about the Trade Facilitation Agreement (TFA), reached in Bali last year. All 160 World Trade Organization (WTO) members, including India, agreed to implement the TFA.

But the government in New Delhi has blocked the agreement, over concerns its food subsidies to the poor could face legal challenges. Under existing WTO rules, stockpiling and food subsidies for the poor are considered trade distorting.

Modi told Obama he hoped for an agreement "soon" to free up the TFA.

"India supports trade facilitation. However, I also expect that we are able to find a solution that takes care of our concern on food security. I believe that it should be possible to do that soon," Modi said.

Frayed ties

Both sides are seeking to address concerns their relationship is under threat, following strained ties on several issues in recent months. An existing civil nuclear agreement is causing some headaches, while last December, US authorities arrested and strip-searched an Indian diplomat in New York on suspicion she mistreated her housekeeper.

In 2005, Modi was denied a visa to the US on human rights ground over anti-Muslim riots in the state of Gujarat, where he was the top elected official. The riots left more than 1,000 people dead.

Modi denies wrongdoing and has never been charged over the deaths. But a lawsuit leveled by a New York human rights group against Modi is trying to get him to answer allegations he failed to stop the violence.

US officials have insisted the lawsuit will not detract from Modi's visit. As a foreign head of government, Modi receives diplomatic immunity.

Obama and Modi first met in a private dinner at the White House late on Monday.

Stressing a common goal of togetherness, the pair wrote a joint article for Tuesday's Washington Post newspaper. They also traveled together to pay homage at a memorial to civil rights leader Martin Luther King, just a few blocks from the White House.

jr/dr (dpa, Reuters, AP, AFP)