US ready to be India's partner in reforms: Paulson

India must continue with its economic reform agenda or risk lose the credibility it has acquired in the world over the years, a top US administration official has said.

US Treasury Secretary Henry Paulson, who will lead a high-level delegation to India, also said that Washington was ready to partner New Delhi to push reforms forward.

"The United States will continue as a partner with India in its economic transformation... We will kick-off another session to help advance the Indian government's economic reform agenda when I am in New Delhi next week," he said in a speech at the Council on Foreign Relations in Washington.

Paulson noted as in any other democratic set-up, India also faced political challenges and the US was aware of it.

"The government is to be applauded for what it has already accomplished, and encouraged to move forward... If India slows its pace now, it risks losing the ground it has worked so hard to gain he observed," he added.

Talking about his upcoming visit, the official said besides reforms, Mumbai's development into an International Financial Centre (IFC) is an important element of that agenda. 

"We understand that Indian officials are concerned that greater capital flows associated with a financial center could add to inflationary pressures, destabilize the domestic financial sector or add to exchange rate volatility. For the most part, India is on the right path to reduce these risks," he said.

India has allowed greater flexibility in exchange rate in recent months, and the rupee appreciation has helped to reduce inflationary pressures, he noted.