India Needs To Attract More Investments If Further Economic Reforms Are Made: IMF

International Monetary Fund has said that though India is improving in business rankings, further economic reforms are necessary to attract investments.

International Monetary Fund

New Delhi: As India gears up to reopen its economy completely, the International Monetary Fund’s Chief Spokesperson Gerry Rice said that India requires further economic reforms for sustainable and inclusive growth. His comments come at a time when companies such as Facebook and Google have pledged USD 20 billion FDI in India. “Concerted efforts have been made in recent years, in India, to strengthen the business climate and encourage investment in trade, and these have helped to attract investment and improve the current account financing mix and also help to contain external vulnerabilities,” said Rice in a report by PTI. According to him reforms such as the National Goods and Services Tax have helped improve India’s ranking for ease of business. But he feels that there are several more areas which require further work to attract investments. .“Relevant reforms have included the new bankruptcy code, the National Goods and Services Tax. These have helped to gain in India’s doing business ranking, moving up rapidly in the World Bank’s Ease of Doing Business index, up to 63 in 2020, from 100 in 2018, significant progress there, indeed,” said Rice. He added, “And, nonetheless, further economic reforms, including labour, product mixed land, and others, and additional infrastructure investment are necessary, in our view, to attract even more investment, and to ensure sustainable and more inclusive growth in India,” he said in response to the question. The pandemic has severely impacted the global economy. Many countries including India were under months or lockdown which has hampered economic growth. Countries are trying to revive their economy by gradually opening up markets. The IMF had recently projected India’s growth rate at -4 in an update to the World Economic Outlook. "Our projection for fiscal year ’20-2021 was revised down, as was the case for most countries driven by the impact of the pandemic. Further outbreaks could require additional lockdowns, and concerns about the virus could also dampen consumer confidence and delay the economic recovery. Again, this is the case not just in India, but in many countries," said Rice in the report.