Friday, October 7, 2016

World sees India as bright spot, experts expect more sunshine

NEW DELHI: Most of the world clearly sees India as an economic bright spot, but the country’s policymakers and industrialists at India Economic Summit of World Economic Forum say there’s a lot of room to improve and lift growth to over 8%.

"We need to work harder with states to remove all regulatory hurdles still prevailing at the lower level," commerce minister Nirmala Sitharaman said at opening session of the 32nd edition of India Economic Summit, jointly organised by World Economic Forum (WEF) and industry chamber CII, on Thursday.
There is near unanimity on the reforms undertaken by the Narendra Modi government, and India has recently improved its ranking in WEF’s World Competitiveness Index by 16 places for the second year in a row to join the top 40 nations.

Sitharaman, who is working towards improving the ease of doing business in the country, said there is much scope for further improvement in ranking and to boost economic growth. She said the government needs to ensure that whatever investment is coming into the country actually translates into rapid productions, exports and lead to creation of good jobs to help the country achiever higher growth rates.

Indian economy is forecast to growth 7.6% according to the latest assessment by the IMF. India’s policymakers expect growth at near 8%.

Sri Lankan Prime Minister Ranil Wickramasinghe, meanwhile, marked out India and China as the only countries that can drive economic growth across the globe and said manufacturing companies have no other place to go. "Asia will bail out the world (from the economic crisis), if it is allowed to frame the rules (policies)," he said.

Speaking on India's inflection point and what the country needs to do to transform the state of its economy and people, NITI Aayog CEO Amitabh Kant said the only way India can catch up with the developed world is through use of digital technology to leapfrog.

"India needs to bring about radical restructuring of its health and education system if it were to grow at a sustainable rate of 8% for the next three decades," Kant said. He identified digital revolution, a strong demographic dividend, a growing entrepreneurial ecosystem, and a larger domestic market as key India strengths.

Pawan Munjal of Hero Motors said the government should take on land and labour reforms head on to help push manufacturing in the country. John Rice, vice chairman of GE, said, "India's missions should be to ensure sustainable and inclusive growth. To achieve this, India will have to ensure to invest in right things, including creation of basic infrastructure and skilling a million of its workforce every month."

Responding to the question of where India is heading after 25 years of economic liberalisation and what needs to be done, Gita Gopinath, economics professor at Harvard University, emphasised that the pace of reforms should continue. "Reforms should continue in the areas of improving competitiveness, ease of doing business and infrastructure, with focus on outcomes in education and health. Also the pace of reforms should not trip around elections if India were to grow at a sustainable rate of 8% and more," she said, adding major emphasis has to be on skilling.

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