NEW DELHI: The Bihar election outcome was a big setback for the Modi government, but that didn’t deter it from launching various policy-level initiatives to boost economic growth and revive investment cycle in Asia’s third largest economy.
The Modi government was quick to bring about changes in the foreign direct investment regime and in the power sector. The government has eased FDI norms for 15 sectors, including defence, broadcasting, construction and retail.
The government aims to improve the ease of doing business, which is likely to be a key catalyst for drawing foreign investments.
“We are seeing renewed vigour and more proactive efforts from the government even in areas where issues need to be resolved more than reforms, for instance the offer to Vodafone to settle the tax row,” said Pankaj Sharma, Head of Equities at Equirus Securities.
“This is contrary to the erstwhile popular view that if the BJP were to lose in Bihar, there would be a negative impact on the reforms process. The winter session of Parliament is set to commence in last week of November and the government has already activated back channel diplomacy to seek more cooperation from the Opposition,” he said.
In the meanwhile, some of the recent policy moves have already started having an impact on the market.
Read full article: Economic Times