Directions for Reforms

• The second generation of reforms will have to embrace all sectors of the economy and cover the central and state governments.
• There is a need to bring down the fiscal deficit and the rate of inflation which will help to reduce the real interest rates.
• Fiscal deficit should be brought down through resource mobilization efforts and austerity.
• Private initiative in infrastructure will not be forthcoming until the services are appropriately priced to cover the full cost of operations.
• Regulatory mechanisms need to be introduced which will oversee pricing of services and other issues.
• The industrial sector will have to adjust and respond to the challenges and opportunities posed by the WTO regime.
• Competition policy and reforms in labour policy will have to be introduced.
• The coverage of PDS should be restricted to rice and wheat only.
• The emphasis under PDS should shift from provisions of food subsidy to stabilization of food prices and assured availability with effective targeting of the subsidy.
• The education system should focus on universal primary education especially the girl child, full literacy and improvements in quality of higher and technical education.
• Access of the poor to public health needs to be improved and the rich should pay the full cost of health services.
• Environmental Accounting should be an integral part of the plan process.
• Initiatives by local bodies, NGOs and women need to be encouraged.
• Administrative and legal reforms should be an integral part of the reform agenda