According to Sebastian Vergara, an Economic Affairs Officer at the United Nations, “India, in our assessment, has the potential to grow at eight percent, not for a few years, but 20 years. For that, India needs to come out with the next series of reforms, for example, promote investment and improve the living conditions of its population.”
Describing India’s economic condition as largely positive and “favorable to growth”, Vergara mentioned various reasons that contributed to this situation:
- “One of this is the growth of private consumption and sound macroeconomic policies. The monetary policy, which has been able to control inflation, also has a role to play.”
- “Fiscal policy in India, in our assessment has been prudent. At the same time, it has provided another support for the economic activity.”
- “There has been deregulation and further liberalization of the policies regarding foreign direct investment.”
- “As the year went on, measures were implemented, financial relief was introduced, steps like credit support for small enterprises helped contain the shock that the demonetization policy created.”
He added that demonetization has benefited the banking sector and increased the tax base — which will help the fiscal accounts; he praised the Indian government’s emphasis on public investment and infrastructure projects, reports moneycontrol.