American lawmakers and the State Department are being primed for the BJP's possible return to power, with perhaps Modi at the helm.

New York: During a recent conference at the Indian consulate in New York, a State Department big shot suddenly found himself speaking admiringly — not gushingly, but with unambiguous approbation all the same — about Gujarat chief minister Narendra Modi.

It was astonishing because the same US State Department had concluded that Modi encouraged or at least countenanced the anti-Muslim violence in Gujarat in 2002 through instructions to police to stand down. In 2005, the US government refused to allow Modi a visa on these grounds.

It made Modi furious that the US was passing judgment on him. He even cranked up his state information department to print a 47-page booklet, titled, “US Refusal of Visa to Shri Narendra Modi: India Stands United.”

Now, American lawmakers and the State Department are being primed for the return of the BJP to power in New Delhi, with Modi at the helm as prime minister, following what US analysts say is a "precipitous" decline in the Congress party's fortunes due to a string of corruption scandals.

"Although still in some disorder in 2011, there are signs that the BJP has made changes necessary to be a formidable challenger in scheduled 2014 polls. These include a more effective branding of the party as one focused on development and good governance rather than emotive, Hindutva-related issues,” says the report by the US Congressional Research Service, an independent research wing of the US Congress.

"Among the party's likely candidates for the prime ministership in future elections is Gujarat chief minister Narendra Modi, who has overseen impressive development successes in his state, but who is also dogged by controversy over his alleged complicity in lethal anti-Muslim rioting there in 2002."

If Modi becomes Prime Minister, the travel ban will naturally be forgotten. “We can’t block a head of state from attending say the annual session of the United Nations general assembly. If Modi becomes India’s prime minister, we will have to put out the red carpet for him,” a US diplomat in Washington told Firstpost.

Despite the bad blood over Modi’s US visa, American companies have a strong love affair with the business-friendly state. US investors describe Gujarat's civil service as a disciplined force that approves land purchases and environmental permits quickly.

Modi on Wednesday tweeted his delight at the surprisingly generous praise for him in the Congressional report; "Another recognition for six crore Gujaratis. US report hails Gujarat's effective governance. Jay Jay Garvi Guj! (Hail, Hail Gujarat).”

The report said Gujarat had averaged more than 11 percent economic growth in recent years, well outpacing the national rate. It accounts for 5 percent of India's 1.2 billion people but 22 percent of the country's exports. Modi has tackled corruption by streamlining “economic processes, removing red tape,” according to the report.

“Seeking to overcome the taint of his alleged complicity in 2002 riots, Modi has overseen heavy investment in modern roads and power infrastructure, and annual growth of more than 11% in recent years," said the report.

Consul-General Peter Haas led a US delegation to Gujarat last week where he said American companies would continue to invest in the state’s dominant cement, petrol, agriculture and technology sectors. The Modi government is hoping to attract $20 billion in foreign investments to develop a center for biotechnology, software development and light manufacturing in coming years in Dholera, a port south of the capital of Ahmedabad. Modi even plans to build a new international airport nearby.

The Congressional report has picked up domestic political gossip and pits Modi against Congress Party heir apparent Rahul Gandhi. It notes that Congress support for Sonia Gandhi's son has resulted in the “corresponding undermining of Singh's political authority."

We may or may not see a Gandhi vs Modi battle, but the heir to the Gandhi-Nehru dynasty took a jab at Modi when he last visited Gujarat to speak to college students. He responded to praise of Gujarat's economic record by comparing Modi to China's Mao Zedong. "Many evil leaders have done great development work," quipped Gandhi in a reference to the 2002 Gujarat riots.