The new American Ambassador to India, Nancy J Powell, flagged off these concerns at what was her first public address in India after she presented her credentials to President Pratibha Patil on Tuesday.
Speaking at the American Chamber of Commerce's 20th Annual General Meeting here, the ambassador said she believed the business of the US Mission in India was "business" and improving bilateral trade relationship and hence she was "naturally concerned" by certain ongoing challenges to trade and investment.
Among the policy decisions that she said cause "significant concern" and "dampen sentiment" about India's investment climate, were retroactive tax provisions in the Finance Bill, that has led to a retrospective tax claim of more than USD 2 billion on British telecom company Vodafone from a 2007 deal.
"The adoption of manufacturing policies discriminatory to foreign companies and the inclusion of retroactive tax provisions in the Finance Bill are two examples (of policy concerns)," Powell said.
The provision for a retroactive tax has caused serious concern among foreign companies and Finance Minister Pranab Mukherjee had to do a lot of explaining on this during his recent visit to the US where he said that proposed changes to bring into the tax net Vodafone-type deals were only clarificatory in nature and the government was ready to listen to the concerns of the business community on this. (MORE) PTI WAJ