In a research report, the US-based rating agency said bureaucracy could slow approval processes in obtaining licences and setting up businesses, prolonging project gestation.
It said a large young and educated workforce, increasing nuclear families and urbanization will fuel demand for housing, cement and new cars.
“While demand across the manufacturing and infrastructure sectors will grow 3-12 per cent annually for the rest of the decade, India’s capacity will still rank well behind China’s by 2030,” Moody’s said.
“Lack of certainty around the amount of time needed for land acquisition approvals, regulatory clearances, obtaining licenses and setting up businesses can materially prolong project gestation. Furthermore, India’s limited multilateral liberalisation with respect to regional trade agreements will also weigh on foreign investments in the country,” it said.
If implemented effectively, measures undertaken over the last few years – including those introduced during the pandemic to increase the flexibility of labour laws, raise agricultural sector efficiency, expand investment in infrastructure, incentivize manufacturing sector investment, and strengthen the financial sector – would lead to higher economic growth, Moody’s said.
In a research report, the US-based rating agency said bureaucracy could slow approval processes in obtaining licences and setting up businesses, prolonging project gestation.
It said a large young and educated workforce, increasing nuclear families and urbanization will fuel demand for housing, cement and new cars.
“While demand across the manufacturing and infrastructure sectors will grow 3-12 per cent annually for the rest of the decade, India’s capacity will still rank well behind China’s by 2030,” Moody’s said.
“Lack of certainty around the amount of time needed for land acquisition approvals, regulatory clearances, obtaining licenses and setting up businesses can materially prolong project gestation. Furthermore, India’s limited multilateral liberalisation with respect to regional trade agreements will also weigh on foreign investments in the country,” it said.
If implemented effectively, measures undertaken over the last few years – including those introduced during the pandemic to increase the flexibility of labour laws, raise agricultural sector efficiency, expand investment in infrastructure, incentivize manufacturing sector investment, and strengthen the financial sector – would lead to higher economic growth, Moody’s said.