INDIANAPOLIS (AP) -- The Indiana Chamber of Commerce president is warning that the state could be hurt by the Legislature's failure to advance a bill extending anti-discrimination protections to include sexual orientation.

The Indiana Senate leader says efforts to add protections for sexual orientation to state anti-discrimination laws are effectively dead this legislative session.

Republican Senate President Pro Tem David Long says he and others had tried to find a fair solution on the issue before its sponsor decided Tuesday to withdraw his proposal.

Long says GOP senators had tried to balance civil rights and religious liberty protections but "took a beating from all sides."

Long says out-of-state groups hampered the chances of reaching agreement with "well-organized extreme messaging" from groups on both sides.

State Chamber of Commerce President Kevin Brinegar says he is frustrated the Indiana Senate wasn't able to move forward on what he called a "critical issue."

The debate over the gay-rights protection bill had split many state business leaders and religious conservatives who are among key Republican Party supporters.

Indiana Gov. Mike Pence's office says he "respects" the decision of a Republican lawmaker to withdraw the bill. A prominent Indiana religious conservative says he also believes state senators took the right step.

Pence's office issued a two-sentence statement Tuesday saying he appreciated the civility in which the issue was debated and that he looked forward to working with legislators on issues such as roads, schools and health care.

Democrat John Gregg says Indiana's economy and reputation will continue to suffer until state civil rights laws include such protections.

Brinegar says the Legislature's inaction on the issue leaves Indiana at a disadvantage in the recruitment, attraction and retention of talented people following last spring's national backlash over the state's religious objection law.

He says state leaders must work together to reach a solution.

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