Prime Minister Manmohan Singh on Friday said his government will move ahead with reforms in labour and financial sectors, but investment in the rural sector would be the real growth engine for the economy to expand by 9-10 per cent.
“We need to push forward the reforms process in the areas you have mentioned and we will do so,” Mr. Singh said while replying to a question by Rajya Sabha MP N.K. Singh on stalled reforms in labour, insurance and the financial sector.
The Prime Minister was addressing the HT Leadership Summit here.
Mr. Singh, said, “Reforms process has many dimensions.” Increased investment in rural infrastructure, more emphasis on health and education “is probably of (the) greatest importance“.
An environment conducive to the growth of entrepreneurship in the urban economy as well ensuring greater government involvement in rural development is required, he said.
The Indian economy had grown by nine per cent for three years in a row up to the end of fiscal 2007-08. However, under the global meltdown, the economic expansion slowed to 6.7 per cent in 2008-09. For the first quarter of the current fiscal, the economy has grown by 6.1 per cent.
Mr. Singh said the main challenge in the next decade would be to achieve and sustain high rates of economic growth and ensure that it remains equitable.