NEW DELHI: An Indian consular officer’s body search and arrest in New York for alleged visa fraud and underpaying her maid has jolted ties between the two countries, US Ambassador to India Nancy Powell said on Tuesday.

In her New Year greetings to the host country, Ms Powell listed several landmark achievements in bilateral ties. But, she added: “Alongside these impressive developments, this forward movement has been jolted by very different reactions to issues involving one of your consular officers and her domestic worker.”

The controversy over the recent arrest of Devyani Khobragade, described by American officials as a consular official at India’s New York consulate, and by Indians as a diplomat, has already evoked regret by US Secretary of State John Kerry.

Ms Powell said she joined Mr Kerry “in expressing our regret for the circumstances of the consular officer’s arrest, but we believe that we can look forward to continuing to expand our bilateral relations.”

The two countries have taken unusually glum steps since the woman official’s arrest in a visa-related case in which she is alleged to have falsified the salary of her Indian maid. India said on Tuesday it is setting up a group of experts to examine information sought from the US consulate on pay and allowances to its Indian employees as well as details about whether establishments running on diplomatic premises were catering to non-consular staff as well.

India also dismissed reports suggesting that the US was steadfast in pursuing the visa fraud case.

“In a pluralist democracy, various channels operate simultaneously and may have different views. We will go by what the State Department is communicating,’’ said External Affairs Ministry spokesperson Syed Akbaruddin.

During her tenure, she said, the US mission has been engaged in not only looking forward but in “joining our Indian partners in moving forward.”

She said the two had joined together on behalf of the children of the world in A Global Call to Action on Child Survival. Also, they have neared the $100 billion mark in two-way trade in goods and services; police chiefs from both countries sat together to share their experiences and to look to greater cooperation; they have had deep and fruitful consultations at the highest levels on resolving some of the world’s crises; and via India’s Mars Orbiter Mission, whose launch Ms Powell was privileged to watch, both boosted their relationship to a whole new world.

“The documentation of our cooperation and collaboration is long and reflects the deepening and broadening of our relationship,” Ms Powell said.

The envoy looked forward to increasing trade and investment that creates jobs in both countries, including civilian nuclear cooperation; to continuing consultations on Afghanistan and other key international issues to protect both of sides’ interests in the region.