Further reforms are needed to ensure that economic growth can both accelerate and be sustained at higher levels, to deliver a better quality of life, Economic Survey 2022-23 said.
The deregulation and simplification of compliances should continue to dismantle the licensing, inspection, and compliance regime entirely, the Survey said.
State governments have to address power sector issues, and the financial viability concerns of the discoms have to be addressed.
Impetus must be given to education and skilling to match the requirements of modern industry and technologies, deal with twenty-first-century challenges such as climate change and energy transition, and make the most of India's demographic dividend, the Survey said.
Initiatives to sensitise the population towards a healthy lifestyle should be continued. Strategies to arrest and reverse the rising obesity levels should be adopted, it added.
Long-range plans need to be formulated to secure the necessary metals and minerals required for energy transition and diversification, the Survey said. Determined efforts should be taken to make the public sector asset monetisation scheme successful in realising wide-ranging efficiency gains from the programme.
If asset monetisation revenues are used to reduce public sector debt, the sovereign credit rating will improve, leading to a lower cost of capital. That will be the biggest fiscal stimulus to the economy.
Reforms to reduce the compliance burden on MSMEs, enhance their access to finance and working capital and equip them with skills, knowledge and attitude to grow their businesses responsibly must continue, the Survey said.
State governments should make conclusive progress on the various factor market reforms in different stages of completion.
While the new age reforms undertaken over the last eight years form the foundation of a resilient, partnership-based governance ecosystem and restore the ability of the economy to grow healthily, further reforms are needed, the Survey said.
The Survey noted that the Indian economy could have grown faster in the absence of the financial and corporate sector balance sheet stress. "Even as we were looking forward to the economy being able to reap the benefits of improved and healthier balance sheets in the new decade, it was buffeted by the global pandemic followed by a sharp rise in the prices of food, fuel and fertiliser."
Negative shocks will and do fade, as they did in the early years of the new millennium. Now, financial and corporate sector balance sheets are in good shape, and there is a willingness to borrow and lend. Hence, it is inevitable that the effects of these reforms will now shine through. A restored credit cycle will rejuvenate the Indian private sector capex cycle, the Survey said.