The government needs to continuously invest in improving the ease of doing business environment, develop sound infrastructure, and ensure availability of trained workforce as India is set on a growth trajectory that promises all-round development, economic welfare and strong macro-economic indicators, noted a recent ASSOCHAM-EY report.
“Improved governance, favourable conditions to conduct business, transparency in government procedures and responsive policy making with an immediate focus on effective implementation of government reforms will continue to evolve India into a preferred destination for foreign investment,” highlighted the report titled ‘India: Transforming through radical reforms,’ jointly conducted by ASSOCHAM and global advisory firm Ernst & Young (EY).
It also termed demonetisation as a major step aimed at strengthening India’s proposition of becoming a transparent economy by curbing black money, terror financing and fake currency circulating in the economy.
“Combining demonetisation with Digital India and Pradhan Mantri Jan Dhan Yojna will ensure transparency in financial transactions. Transfer of subsidies through bank accounts opened under the scheme has removed the middlemen, thus eliminating one of the biggest contributors to corruption,” said the ASSOCHAM-EY report.
It also said that the GST (goods and services tax) which is expected to be rolled out by July 2017, will further boost the economy by simplifying the indirect tax structure, and eliminating the cascading effect of taxes on customers and make doing business easier in the country.
Hailing the Centre’s ambitious Make in India initiative, the report said that it has provided robust support to India’s manufacturing sector, backed by domestic demand and many regulatory reforms. It has helped India become the sixth largest manufacturing economy in the world in 2016.
Reforms like ‘Power for All’, ‘Smart Cities’, ‘Skill India’ and ‘Startup India’ are expected to work in tandem with ‘Make in India’ to help the country achieve the goal of becoming a manufacturing hub, it added.
“All these radical reforms are acting as enablers for boosting the domestic environment which in turn is improving the country’s stature globally,” further said the report. “The major reforms from the Government will continue to boost investor sentiment and India’s outlook across the world.”
It also complemented the Government’s view of promoting innovation and entrepreneurship through reforms like Startup India and Skill India, to equip the young workforce to face the changing global economic environment and technological disruption.
While the pace of India’s radical reforms may vary, the direction is firmly set toward higher growth. The economy will continue to benefit from significant progress in trade, proactive policy actions and robust external buffers.