By Annie Banerji
ALINA, India, Oct 11 (Reuters) - Britain's envoy to India will meet a Hindu nationalist who many think could be the next prime minister, the first such visit since deadly religious riots in his state 10 years ago and a major boost to the pro-business leader's quest for mainstream acceptance.
Britain's foreign minister for India, Hugo Swire, on Thursday instructed the envoy to visit Chief Minister Narendra Modi, a policy shift that reflects both the leader's rising prominence and the western state's weight in the Indian economy.
"This will allow us to discuss a wide range of issues of mutual interest and to explore opportunities for closer cooperation," Swire said in a statement.
Modi is seen as the strongest opposition candidate for general elections in two years, thanks to rapid growth and a perception of corruption-free governance in his state, which has 5 percent of India's population but contributes 16 percent to national industrial output.
But charges he was complicit in the riots that killed at least 1,000 mainly Muslim victims have cast a long shadow over his ambitions. Despite big investments by European and U.S. corporations in Gujarat, Modi has been shunned by Western governments since the religious violence.
An official at the British High Commission in New Delhi said the policy shift reflected Gujarat's dynamic economic and business climate and came after high-profile convictions of some politicians in the state over the riots.
"If you can't engage at a senior political level, it is harder to spot opportunities," the official said, also acknowledging that Modi's rising political fortunes were a factor in the decision.
No date has been set for the visit, which needs approval by India's foreign ministry. "We hope soon," the official said.
"GOD IS GREAT"
Modi has enjoyed a steady rehabilitation since the Supreme Court last year demoted to a lower court a case over his role in the riots. Opinion polls consistently rank him as India's most popular politician and the favourite to replace Prime Minister Manmohan Singh after the next elections, which are due by 2014.
He is feted by Indian and foreign companies alike for slashing India's notorious red tape and building the infrastructure they need to do business, although many analysts say he would struggle to garner support from enough of India's religiously diverse electorate to take to the national stage.
"Gujarat has already won a huge amount of confidence, not only nationally, but globally too," Modi told Reuters on Thursday before news of the British decision emerged.
"The outsiders know and understand the policies of Gujarat. As you probably know, Gujarat is a policy-driven state," he said, speaking in the village of Alina from an election campaign bus that was surrounded by hundreds of supporters.
His Bharatiya Janata Party (BJP) is expected to win easily in elections to Gujarat state's legislative assembly that will be held in December.
Modi later Tweeted "God is Great" in response to the British decision and posted the government's statement on his website even before London was able to distribute it widely.
In April, the U.S. consul general in Mumbai joined Modi at a solar energy event in Gujarat. His presence was seen as a sign that the United States, which has denied Modi a travel visa because of the riots, was warming to him.
Last month, a sitting lawmaker and former member of Modi's cabinet was convicted of murder and jailed for 28 years for having a leading role in the violence, including handing out swords to Hindus in the riots that raged for days after suspected Muslims set fire to a train carrying Hindu pilgrims.
Commentator Vinod Mehta said the British move was a victory for business interests that Modi would use to enhance his reputation.
"Embassies in India now have forgotten politics and it's all business," said Mehta, founder editor of weekly news magazine Outlook. "The British are opening a line to a possible contender (for prime minister) and a line to a state with a very business-friendly environment."