India a bright spot, but reform implementation holds key: IMF

Calling India a "bright spot" in the cloudy global economy, IMF chief Christine Lagarde on Monday prescribed reforms in subsidy, labour market and monetary policy and a stable regulatory regime for boosting private investments and growth.

On a two-day visit to India during which she is meeting Prime Minister Narendra Modi and Finance Minister Arun Jaitley, she also pitched for steps to ease land acquisition and doing business. "In this cloudy global horizon, India is a bright spot. Recent policy reforms and improved business confidence have provided a booster shot to economic activity," she said while speaking at a function in Lady Shriram College here. She said IMF expects the economy to grow by 7.2% this fiscal and 7.5% in the next year, making India the fastest growing large economy in the world.

However, Lagarde said, "urgent remedies are needed. A good starting point is to make Indian labour markets more flexible." She was of the view that the progress on reform measures can help underpin the consolidation effort, such as further subsidy reform and implementation of the goods and services tax (GST).

"Those reforms are bold but we need resilient implementation. It is always key to success around the world... It is a case here as well," Lagarde said, while adding that much still needs to be done to boost private investment in the country and the reform measures must be on the "actions list" now. 

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