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The world’s economic waters are choppy, to say the least Some of the most battle-hardened armadas have floundered in the last few years, what to speak of emerging economies like India Battered and beleaguered, our economy needs critical repairs That’s reforms by another name

Experts agree that nearly every sector needs urgent reforms, but there are some that simply can’t wait That is the challenge before this government—to spread itself thin over the entire economy and wait for the changes to take effect, or to allocate limited time, money and energy to key zones and breathe new life into the economic engine India needs to spend a trillion dollars on infrastructure over the next five years, also needs a long-term debt market to fund this, foreign institutional investors need more confidence in its economic outlook, and its fiscal deficit is rising

Far reaching reforms covering several sectors of the economy in a mutually reinforcing fashion, are the need of the hour As in the years following 1991, in the medium term, visible changes in the task of stimulating growth and investment will be less dramatic, but it is not altogether surprising Many countries going through structural adjustments experience sluggish, and indeed even negative, growth in the early years

Savings, investment and fiscal discipline worked well the last time, they will work equally well now—this is basic economic wisdom The government’s staggering subsidies bill weighs the system down but it is a sensitive subject, more politically, than economically Still, subsidies will need restructuring The transition to a higher growth path, sustainable from the balance of payments point of view, requires a revival in total investment In the last set of reforms, industrial and trade policy reforms went far, but now, they need to be supplemented by labour market reforms, a critical missing link If the aim of the reforms is to achieve higher and sustainable GDP, industrial growth has to be substantially high, and stay there At the macro level, fiscal policy, monetary and trade policies need particular attention, as does, rather urgently, the sensitive business of exchange rate management Micro economic reforms that the economy must go through include policy and implementation level changes in the industrial sector and massive investments to bring about drastic infrastructure improvement Financial sector strengthening and capital market deepening, too, need attention

The overarching purpose of the 1991 reforms was to free the private sector from impeding government controls and shoring up the fiscal system This has instilled muscle-building competition and unleashed entrepreneurial energies all around Now, experts say the four prime focus areas for reforms are agricultural, urban and human resource development, and the management of public services We need greater investment and employment growth along with higher productivity, and these need a significant capacity expansion and more easily and widely available public services beyond the realm of the private sector The first generation of reforms boosted the private sector The next series of reforms should focus on the public sector to deliver public goods and services Inclusive growth will need the monster of poverty tamed and employment opportunities for the expanding young labour force

In ‘The Tipping Point: How Little Things Make a Big Difference,’ Canadian journalist-social economic Malcolm Gladwell said many large changes sometimes happen in a hurry A whole set of cascading events reach a point and trigger those changes—Gladwell called The point The Tipping Point One may call it the inflection point “Same difference,” Gladwell would say

The Indian economy was at this tipping point 20 years ago It is once again there

Do tipping points bring economic well-being?

It all depends on whether you are pushing, or pulling