The Indian government must accelerate implementation of major policy reforms to attract investments and keep up with projected economic growth, Morgan Stanley Asia's managing director Chetan Ahya said today.
India should undertake strengthening of its institutional capacity to allocate critical national resources such as land and minerals to public and private corporate sector in a transparent manner for rapid industrialisation, Ahya told reporters at the two-day Morgan Stanley Asia Pacific Summit, that started here today.
Ahya pointed out that India’s two-pronged strategy needed strengthening of institutional capacity to manage transparent awarding of major infrastructure projects under public-private route.
India should also build a comprehensive plan for energy security along with a systematic programme for energy pricing reforms, Ahya said while stressing on the need for initiating aggressive fiscal consolidation.
He said the country should allow foreign direct investment in multi-brand retail distribution, insurance and other areas to build a sustainable source of capital inflows.
Ahya called on India not to delay any further the 25-30 planned infrastructure projects as quick executions of these investment-oriented developments would bring in the much needed foreign investments and capitals.
He noted India's good initiatives including the awarding of national highway contracts and reducing the environmental approval delays for coal mining.
However, Ahya cautioned that clear signs of Indian economic slowdown have emerged in the last 3-4 months, even though the economy had till March this year maintained relatively strong growth.
Morgan Stanley sees India’s gross domestic product growth at 7.3% this fiscal and 7.4% in the following year, but warns that the eurozone crisis can impact the country's exports.