What are the key reforms that the government should immediately undertake ?  

Let us distinguish between ”reforms”, which means changes in policies or laws, and “executive action” which means taking decisions within the existing structures or system. Both are important , but for immediate effect right now, I would concentrate on executive actions. The most important to act is making sure that implementation of large projects in the infrastructure sector is accelerated. There are problems related to environment and forest clearances which could easily be speeded up. Some relate to resolving fuel supply problems for thermal power plants and dealing with domestic coal shortages and planning for coal imports. We currently have an environment in which bureaucracy has become reluctant to take decisions that may become controversial. But the mechanisms can be devised to overcome this. We have identified many of these problems and steps are being taken to address them. I hope this effort will gain momentum. Another important area of executive action relates to macro economic management. We have set a target of reducing the fiscal deficit and we must ensure that it is met. That is not a reform- it  is simply doing what we have said we will do. That may include some difficult things, like for example the adjustment in fuel prices, which the prime minister himself mentioned recently. Apart from this, there are “reforms.”

We must undertake These don’t have an impact on the economy immediately their impact is fell over time, but they are also important in the short run because they affect in investment climate, which is depressed at present. There are several such reforms in the pipeline. FDI in retail is an area where the government has said they are working to built a consensus. There are very important bills in parliament, relating to banking and insurance which would send a good signal. Most important of all is the GST, which would be a game changer if we can get a consensus among the states. And don’t forget aadhar which is rolling out very well and can be a game changer in delivery of critical services and benefits.

Do the compulsions of coalition politics make it difficult to pursue tough economic reforms?

Tough reforms are always difficult, even in a single party govt. since different views will be reflected within the party as they should be, but in a coalition it is definitely more difficult, by definition. That is true not just in India but all over the world.

Some experts and agencies have said that they don’t see any meaningful reforms until a new government is in place in 2014, what is your assessment?

I definitely don’t share this view. Those who are getting despondent should remember that better economic performance in the next year or two doesn’t depend on reforms alone. We grew for five years at 9 percent; poverty declined and we have achieved record food grain production. All this happened even through the “reforms” that people are currently worrying about were not done. Right now, we should focus on reviving the investment climate and improving implementation of infrastructure projects and bring back rapid growth and job creation.