"There is a renewed sense of optimism in the air and we share that sentiment," said the US India Business Council (USIBC) acting president, Diane Farrell.
"The new Indian government is dynamic, robust - and the excitement generated by the election must now be capitalised on," said Ron Somers, who recently left USIBC as its president to form own policy advocacy group to improve India US relationship.
Describing the invitation of the SAARC leaders to the swearing-in ceremony as a foreign policy masterstroke, Somers said bold reforms like opening insurance and defense will spur investor enthusiasm, attracting investment and technology.
"USIBC member companies are in this partnership for the long-haul and we look forward to engaging with Prime Minister Modi and the newly appointed Cabinet to deepen investment and increase bilateral trade to USD 500 billion by 2020," Farrell said.
Tweaking the defense offset policy for sole-sourced defense purchases, which essentially will widen the aperture on the definition of qualified defense offsets to include aspects of the economy that are essential to national security - like energy security, food security, water security, and health security - would unleash as much as USD 4 billion of foreign investment immediately into the Indian economy in areas where investment is needed the most, Somers said.
"The goal must be to create a magnetic pull for investors to return to India, by attracting international attention, taking dramatic steps to improve the business climate," he said.
According to the Conference Board, a non-profit business membership and research group organisation, the big question is whether India can change enough to be a powerhouse.
"That question depends on reforms to unleash the power of India's service sector while revving up its nascent industrial sector. India's manufacturing is largely a cottage industry. Small enterprises make up 84 per cent of its manufacturing base, compared to China's 25 per cent, for example," it said.
"As with any new administration, they (Modi Government) start with a degree of public support. How much can they do and how effective their policies will be also impact the willingness of companies and investors to pour capital into new projects. India has great potential but many hurdles to turning potential growth into actual growth," The Conference Board said.