Economic Survey stresses private sector’s role in infra development
The Economic Survey tabled in Parliament on Friday underlined the importance of private participation in the infrastructure sector to realise Viksit Bharat@2047.
The Economic Survey 2025 has highlighted challenges in the regulatory environment for the MSMEs. It said the regulatory compliance burden holds back formalisation and labour productivity, limits employment growth, chokes innovation and depresses growth.
The Survey observed that the tendency for firms in India is to remain small and the logic for it often is to remain under the regulatory radar and steer clear of the rules and labour and safety laws.It said that the biggest casualties of this are employment generation and labour welfare, which most regulations were originally designed to encourage and protect, respectively.
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The Union Government has undertaken deregulation by implementing process and governance reforms, simplifying taxation laws, rationalising labour regulations, and decriminalising business laws.
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“On their part, states have also participated in deregulation by reducing compliance burdens and simplifying and digitising processes”, the Survey said.
The assessment of states as per the Business Reform Action Plan (BRAP) formulated by DPIIT shows that deregulation helps spur industrialisation.
Stating that such efforts have laid the foundation for states to embark on the next round of reforms now, the Economic Survey 2024-25 has outlined a three-step process for states to systematically review regulations for their cost-effectiveness.
The steps include identifying areas for deregulation, thoughtfully comparing the regulations with other states and countries and estimating the cost of each of these regulations on individual enterprises.
It mentioned that the Ease of Doing Business (EoDB) 2.0 should be a state government-led initiative focused on fixing the root causes behind the unease of doing business.
The Survey further stated the importance of equity funding to MSMEs.
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