(CNN) -- The United States should drop charges against an Indian diplomat accused of fraud and making false statements on a visa application for her housekeeper, the country's foreign minister told CNN on Friday.
"I imagine yes, if we think the charges are unwarranted, unjustified, then how would we say, 'But you can carry on,'" Foreign Minister Salman Khurshid said. "I mean charges have to be withdrawn."
Devyani Khobragade, India's deputy consul general in New York, was arrested and stripped-searched last week on charges of visa fraud related to her treatment of a woman she brought from India to work as her housekeeper.
She's accused of telling the U.S. government she would pay the woman, who has been publicly identified as Sangeeta Richard, $9.75 an hour. Authorities say in reality, the woman received only $3.31 an hour and was told to keep quiet about the arrangement.
"This type of fraud on the United States and exploitation of an individual will not be tolerated," the chief federal prosecutor in Manhattan, U.S. Attorney Preet Bharara, said Thursday.
Khurshid, however, said the matter should have been handled by Indian courts.
"It's not a really good idea to have people put question marks on the Indian judicial system," he told CNN. "We may take time to decide cases in this country, but we have one of the finest rule-of-law institutions.
"I mean if you have a problem, you have a problem about compliance with the labor law, just tell us," Khurshid said. "I mean what would we do — either withdraw the person, the employee — or just negotiate a, negotiate some, some exceptions."
The incident has outraged Indian politicians, some of whom may be stirring up anti-U.S. sentiment ahead of presidential elections, prompting the removal of barricades from the road leading to the U.S. Embassy. A senior U.S. official expressed concern about removal of the barricades.
But Khurshid told CNN's Mallika Kapur that traffic barricades, not security barricades, were removed.
Indian politicians have called the diplomat's treatment "barbaric" and Prime Minister Manmohan Singh called her treatment "deplorable."
Bharara defended how Khobragade was treated, saying officials took pains to treat her better than many other suspects.
"Khobragade was accorded courtesies well beyond what other defendants, most of whom are American citizens, are accorded," he said Wednesday. "She was not, as has been incorrectly reported, arrested in front of her children. The agents arrested her in the most discreet way possible, and unlike most defendants, she was not then handcuffed or restrained."
In addition, she was allowed to keep her phone and make calls to arrange personal matters, including child care, he said.
Khobragade was strip-searched by a female officer, Bharara said, but noted that's standard practice for every suspect taken into custody of the U.S. Marshal's Service.
In a statement, Secretary of State John Kerry expressed "regret" over the situation, without saying the United States had done anything wrong.
State Department spokeswoman Jennifer Psaki said officials are trying to arrange a call between Kerry and Khurshid. She also said the department has not received a request to change the status of the Indian diplomat and that such a change would not wipe out any criminal charges filed before her immunity status changed.
Khurshid said Friday he hoped the row would not pose long-term harm to U.S.-Indian relations.
"I think it's important that we, we understand this is a valuable relationship for both sides. There's a huge amount of investment both public and private into this relationship," he said, "and I don't think the world wants a relationship like this to deteriorate at all."
Khobragade is charged with one count of visa fraud and one count of making false statements, which carry a combined maximum sentence of 15 years in prison.
According to court documents and statements, prosecutors argue she lied in her visa application to bring the housekeeper to the United States, promising to pay her the minimum wage of $9.75. She was actually paid $3.31 an hour, prosecutors say.
Khobragade allegedly instructed the housekeeper to say she would be paid the higher rate and not mention her actual pay.
Khobragade allegedly also had the housekeeper sign another employment contract that "deleted the required language protecting the victim from other forms of exploitation and abuse" and also deleted language that said Khobragade agreed to abide by U.S. laws, Bharara said Wednesday.
That document wasn't provided to U.S. authorities as part of the visa application process, authorities said.
Her attorney, Dan Arshack, said Thursday that the allegations have "nothing to do with what the actual facts are."
Richard requested the second contact, Arshack said. The document shows that a portion of Richard's earnings would be sent to her husband in New Delhi, he said.
"And that's what happened," Arshack said. "And that's what the documents support."
But Dana Sussman, the housekeeper's attorney, said his client was only paid the smaller amount, which was deposited into an Indian bank account. Her client denies being given any money in the United States that could be considered a salary, she said.
"I don't know what he's talking about," Sussman said of Arshack's claims. "This story seems to keep changing."
CNN's Josh Levs, Jethro Mullen, Tom Watkins, Deborah Feyerick, Elise Labott, Harmeet Shah Singh, Ross Levitt and Susan Candiotti contributed to this report.