The Hindu Business Line : ‘Second generation reforms needed for over 8 pc growth’

Hyderabad, Aug. 26 To ensure economic growth rate of above 8 per cent, second generation economic reforms should be taken up on a warfooting, according to Dr Percy S Mistry, Chairman, Oxford International Group.

Delivering a talk on ‘Global turbulence and the likely implications for India’ at Administrative Staff College of India (ASCI) here on Tuesday, Mr Mistry said the economic reforms in India “are dramatically slow after 1992-93,” and the current growth trends were fruits of the first generation reforms.

“To withstand the impact of financial slowdown in the US and Europe, the oil and commodity price shocks, inflation and the likely stagflation, we need second generation reforms in spreading the benefit of market functioning throughout our economy,” he said.

A swift transition toward an open current account, restriction of Reserve Bank’s of India’s role only to monetary policy and targeted income subsidies in the form of price subsidies, among others were the need of the hour, he said.

In addition, to cope with the geopolitical realities of tomorrow, India must develop and project a much clearer vision and strategy about what role it is going to play in the world as one of its most populous countries and one of its four largest economic blocks, the noted economist said.

The South and East Asia would become larger players in global finance than the US and Europe. “Though changes would bring about profound changes in perceptions of global security needs and questions about who polices the world. We are simply unprepared for it,” he said.

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