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New Delhi: Reviving rural demand and encouraging private investment are some of the key challenges facing the Indian economy, the World Bank said in its India development update released on Monday, adding that the country’s growth will be driven by urban consumption and a surge in public investment in the near future.
“The challenge for the Indian economy is to activate the stalled engines-agricultural growth, rural demand, trade and private investment while ensuring that demand from urban households and public investments termed as the working engines of the economy, do not run out of fuel”, the report said adding that the surge in public sector investment is unable to offset the weaknesses in private sector investment.
Implementation of the goods and services tax, increased participation of women in the labour force, improvement in the business environment and increasing private investment will be some of the key measures India will have to take to reach double-digit growth, the report said.
Earlier this month, the World Bank forecast that the Indian economy will grow 7.6% in 2016-17 and 7.7% in 2017-18, marginally lowering its forecast by 0.2%.