PM Modi govt needs to prioritise land, labour reforms: Analysts.Modi govt needs to prioritise land, labour reforms: Analysts on Business Standard. Prime Minister Narendra Modi
Analysts said on Thursday that Prime Minister Narendra Modi should give priority to land and labor reforms during his second term. He said that the decision of the people - the NDA is ruling on the power, as the BJP itself will have a comfortable majority - will ensure policy continuity.
Domestic rating agency Crisil said that policy continuity "offers an opportunity to further improve the hard improvements in land and labor". It says that the economy is currently undergoing cyclical recession, which has seen an increase of 7 percent.
The agency's peer care ratings said that development on the political front is very positive for the economy because the government can continue to pursue its economic structure because "the majority are full because of no legislative barrier". It said that labor reform is necessary from industrial perspective as well as from the point of view of employment generation and it should be seen in a timely manner.
There is a need to re-think the policies of land acquisition, he said that this will help in obtaining investment from foreign and private capital. American Brokerage Goldman Sachs suggested that land reforms may include transparent auction and digitization, enabling environment for labor on the front of the land.
The government should also look at privatization - a politically sensitive issue - beyond the source of revenue, Care Ratings said, adding such measures would help in enhancing efficiency. Crisil advised the government to pursue long pending tough decisions and also advised to create necessary fiscal space for infra spending.
In other priorities, it should also see the financial sector crisis, reduce the GST and IBC framework and solve the crisis in the agricultural sector. Both rating agencies said that employment generation - which was lacking in an attempt to exploit the opposition in the campaign - should be an important focus for the new government.
Analysts of Japanese Brokerage Nomura said, "Contrary to the first term of BJP, where discrimination came at the cost of development, policy priority will be redefined as a primary priority in the second term." To see if the important ministers of the Cabinet will be monitored.
Shubhada Rao, Chief Economist of Private Sector Lenders Yase Bank, said that promoting rural consumption, awakening through troubled non-bank lenders and global business warfare will have immediate economic priorities for the new government.
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