Lack of reforms during the previous tenure of the government had put the investment climate in a state of slumber. Thus the newly elected government managed to sweep the elections on the promise of rejuvenating the economy. The government has already set the ball rolling by de-regulating diesel and hiking gas price. However a number of areas need to be worked upon to make the investment climate more business friendly. Land acquisition continues to be one of the biggest stumble blocks in large infrastructure projects. The Finance Minister is looking towards amending the land acquisition law to give way for the implementation of smart cities in the country.
Another hurdle that has stalled large projects in the country is the shortage of power on low availability of coal. The country's largest coal mining company <>Coal India has fallen short of its production targets for quite some time now on account of red tapism. The government on its part passed an important ordinance opening doors in commercial mining for private companies. The government aims to follow the e-auction route to allocate coal blocks for greater transparency and is giving finishing touches to a re-worked mining law. Amendments to simplify outdated labour laws are also underway.
To further ease the business environment in the country, we would further need Goods and Services Tax (GST) regime. The government is in the last stages of discussion with the states to arrive at a consensus on the same. Apart from this, the government is also working towards rationalizing the taxation policy to further attract investments.
Thus the country has embarked on an aggressive battle against slowdown through the reform process. This in turn is also winning accolades from the west. Recently the Organization of Economic Co-operation and Development (OECD) has forecast the economic growth in India to reach almost at par with China by 2016. Of course, this forecast can materialize if the government's reform process remains on course and is implemented properly.