International Monetary Fund's (IMF) Chief Economist Gita Gopinath on Friday said that the regulatory uncertainty has played a major role in the economic slowdown in India.
"I believe, in the slowdown, regulatory uncertainty has played a role. That's another factor that needs to be addressed. It is important for India to take up reforms but to be able to do this with greater clarity and greater certainty would help," Gopinath said at industry chamber FICCI's 92nd Annual Convention.
She also added that some high-frequency indicators are signalling that the economy may not revive anytime soon.
Gopinath also said that the Goods and Services Tax (GST) has been significant in formalising the Indian economy.
"GST, which has been very important for formalising the Indian economy, but again there... certainly more needs to be done on what the rules are, what the rates are going to be," she said.
The economist further highlighted that macro-economic stability is very important for India including fiscal consolidation. Concerns related to growth in rural income should be addressed.
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"Macroeconomic stability is very important for India including fiscal consolidation. Concerns related to growth in rural income should be addressed. There are important reforms needed with respect to land and labour. The economy needs reforms and it is important," she said.
The IMF chief economist, however, expressed optimism by noting, "Possibly 2020 may see recovery globally or could be better than 2019 with some downside risk.