Moody’s Investors Service upgraded the Indian government’s debt ratings after almost 14years. India’s economy is said to have improved from stable to positive. The boost it provides will encourage private investors to invest more. Besides, Indian companies will be allowed to raise debt overseas at lower interest rates. Moody’s upgrade emphasises the role and the need for structural changes to juice up the Indian economy. All this is despite the fact that the Indian government’s debt ratio to the GDP is much higher than the median rate among comparable countries. India’s bright outlook is attributed to structural reforms. The GST recently rolled out is a major factor. Aadhaar linked direct benefit transfer and reforms in factors of production like land and labour will be the indicators of economic uplift. India is on an upward trajectory as successive governments since liberalisation of the economy in 1991 have put their best foot forward to incentivise economic reforms.
The GST is but only one measure for development to fulfil its economic potential, the country needs other significant reforms. It goes without saying that economic prosperity depends on increased productivity. That will be possible only if the skills of the workforce are developed. The Indian government needs to put maximum stress on raising educational standards. The Microsoft giant has drawn attention to the country’s backwardness in that as well as in the health sector. These reforms are part of the welfare segment and of the utmost importance. Prime Minister Narendra Modi should be upbeat about the optimism generated by rating of economic growth as positive. things should look up in the long run if the political problems are solved. The centre and the state governments should sink regional differences and go full steam ahead in implementing reform so that the country’s economic potential is actualised to the maximum extent.
