The Indian economy underwent a gamut of wide-ranging structural and governance reforms during 2014-2022 which strengthened the economy’s fundamentals by enhancing its overall efficiency.

The Economic Survey 2022-23 presented in Parliament today by Minister for Finance Nirmala Sitharaman stated that with an underlying emphasis on improving the ease of living and doing business, these reforms were based on the broad principles of creating public goods, adopting trust-based governance, co-partnering with the private sector for development, and improving agricultural productivity.

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The Survey highlights that the above transformative reforms undertaken by the government had lagged growth returns due to temporary shocks in the economy.

However, in the present decade, the presence of strong medium-term growth magnets provide optimism and hope that once these global shocks of the pandemic and the spike in commodity prices in 2022 fade away, the Indian economy is well placed to grow faster in the coming decade.

According to the Survey, the reforms undertaken before 2014 primarily catered to product and capital market space. They were necessary and continued post-2014 as well. The government, however, imparted a new dimension to these reforms in the last eight years. With an underlying emphasis on enhancing the ease of living and doing business and improving economic efficiency, the reforms are well placed to lift the economy’s potential growth.

The broad principles behind the reforms were creating public goods, adopting trust-based governance, co-partnering with the private sector for development, and improving agricultural productivity.

 “This approach reflects a paradigm shift in the growth and development strategy of the government, with the emphasis shifted towards building partnerships amongst various stakeholders in the development process, where each contributes to and reaps the development benefits (Sabka Saath, Sabka Vikaas),” stated the Survey.

The Survey notes that a quantum leap in policy commitment and outlay for infrastructure is now visible in the last few years, cushioning economic growth when the non-financial corporate sector was unable to invest due to balance sheet troubles. In doing so, the government has laid a good platform for crowding in private investments and growth in the coming decade.

Besides the push to physical infrastructure, the government’s emphasis on developing public digital infrastructure during the last few years has been a game changer in enhancing the economic potential of individuals and businesses.

With its strong forward linkages to the non-digital sectors, digitalisation strengthens potential economic growth through various channels. Some of these, such as higher financial inclusion, greater formalisation, increased efficiencies and enhanced opportunities.

According to the Survey, building trust between the government and the citizens/businesses unleashes efficiency gains through improved investor sentiment, better ease of doing business, and more effective governance.

The Survey notes that a fundamental principle behind the government’s policy in the post- 2014 period has been the engagement with the private sector as a partner in the development process.

The agriculture sector in India has grown at an average annual growth rate of 4.6 per cent during the last six years, as observed by the survey. This growth is partly attributable to good monsoon years and partly to the various reforms undertaken by the government to enhance agricultural productivity.