DNA Money Edit: Decisive mandate for structural reforms

As BJP gets a decisive mandate to form the next government, hopes are soaring on its propinquity to undertake reforms. There is a sense of emergency when economists talk about India's need to revive consumption and investment, both of which have been sagging of late, leading to a fall in the country's economic growth. Employment generation, manufacturing and infrastructure and agriculture reforms are some other areas that need immediate attention. The government should address the distress in agriculture and rural economy as part of its medium-term goals. Since the service sector creates more jobs per unit of investment, the government may have to provide a better balance between the services sector and manufacturing.

In the last five years, the government has surely worked hard for digitisation and financial inclusion. But the agenda remains incomplete. The government may have to devise new ways to expand its Digital India campaign. 

In a recent interview with DNA Money, India's chief economic advisor Krishnamurthy Subramanian said that India has to emphasise on enhancing productivity going forward. Among others, he enumerated three main factors that need to be focused -- production-land, labour and capital, and suggested that the cost of each of these needs to be brought down. A Goldman Sachs report said that going forward, there could be potential structural reforms focusing on land (transparent auctions), labour (regulatory environment), privatisation (in agriculture and banking) and export promotion.