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Geithner Meets Chidambaram in Delhi

By GARDINER HARRIS

Timothy F. Geithner, the United States Treasury secretary, returned to his childhood elementary school here in India on Tuesday before attending a day of meetings with Indian leaders and business executives.

Both Mr. Geithner and his Indian counterpart, Finance Minister P. Chidambaram, gave the usual platitudes in a news conference about how their discussions were “fruitful” and “substantive.” And Mr. Geithner praised India for undertaking a series of important policy changes to ease restrictions on foreign investments in the country's retail, media and airline sectors.

“I think the reforms outlined by the government of India offer very promising paths to improving growth outcomes for th e Indian economy,” Mr. Geithner said. “They will be welcomed around the world.”

Investors have greeted the changes warmly, driving up India's stock market and the value of its currency, the rupee. But India has yet to bury its long tradition of protectionism and socialist policies, so those changes have caused political tumult, leading one of the governing coalition's biggest allies to leave the government and call for a vote of no-confidence.

Since those who have railed against the latest policy changes have accused the Indian government of selling out to the Americans, Mr. Geithner's praise is not likely to benefit the Indian government politically. But Mr. Chidambaram, never a jolly presence, nonetheless seemed pleased.

Mr. Chidambaram said he had expressed some concerns to Mr. Geithner as well as to the Federal Reserve chairman Ben S. Bernanke, who joined Mr. Geithner in New Delhi, about the Federal Reserve's new plans for monetary easing.

“I raised the concern that it may impact commodity prices, and commodity prices may rise,” said Mr. Chidambaram. The Americans pointed out that commodity prices had not yet risen, Mr. Chidambaram said. “We will wait and see, but if the quantitative easing revives the U.S. economy, that helps us.”

Mr. Geithner later attended a meeting with Indian business leaders at a fancy hotel in town, and he was asked several times what advice he had for Indian leaders. Each time his answer was the basically the same.

“I'm not going to offer advice to this great and dynamic country,” he said.

He did, however, offer some compliments to India's present leaders. “They seem to have very good awareness of not only what's good economic policy for India but how to engender more confidence so that you can get more investment” from both domestic and international investors, he said.

He also said that he was optimistic about I ndia's prospects for sustained long-term economic growth.

“My view is that the basic forces that over the last decade in India, and a little longer in some other economies, produced strong economic growth. I think those forces are still intact,” he said.

Mr. Geithner spent most of his childhood in Africa and Asia, with several formative years at the American Embassy School in India's capital. He returned to the school Tuesday morning and answered questions from students as well as a few parents for nearly an hour.