India must focus as a priority on ensuring that more women work in the formal sector as it continues with labour reforms, according to Ken Kang, the deputy director in International Monetary Fund (IMF) Asia Pacific Department.
India must focus as a priority on ensuring that more women work in the formal sector as it continues with labour reforms, according to Ken Kang, the deputy director in International Monetary Fund (IMF) Asia Pacific Department. While “in recent years India has made very impressive progress in reforms,” he said that “looking ahead there are important policy priorities” and listed three among them.
“One, is to continue improvements in product and labour market reforms with a focus on increasing formal female labour participation to improve the business environment, and reduce complex regulations, but also to address supply bottlenecks, particularly in the agricultural sector and distribution networks,” Kang said at a news conference on Friday in Washington.
As one of India’s major reform achievements, he mentioned the “introduction of flexible inflation targeting and of a statutory monetary policy which has helped to strengthen the monetary policy framework.”
The Reserve Bank of India Act was amended in 2016, to provide for a Monetary Policy Committee that decides on the interest rate required for achieving the inflation target set by the government in consultation with the bank.
The other achievements include the Goods and Services Tax (GST) and the “major recapitalisation plan for the public-sector banks in order to accelerate the work out of nonperforming loans, as well as made some important legal improvements through a new insolvency and bankruptcy law,” Kang said.
“We expect and hope that the reform momentum continues,” he added.
“We are not saying that India’s structural reform speed will slow down because of elections,” Changyong Rhee, the IMF director of the Asia Pacific Department said.
“What we are saying is that the growth momentum and the structural reform momentum should continue despite the election period. So there is something misquoted,” he added.
On Thursday, IMF Managing Director Christine Lagarde had said at a news conference on Thursday, according to the IMF transcript: “We have seen and we are seeing — I am not sure that we will be seeing in the next few months given the elections that are coming up — major reforms that we had recommended and advocated for a long time.”