Sustaining Employment and Euitable Growth: Policies for Structural Transformation of the Indian Economy

Abstract

Arvind Virmani’s paper examines the structural challenges of the Indian economy post-1990s reforms, emphasizing the need for systemic transformation to sustain employment and ensure equitable growth. Key recommendations include enhancing competition and private investment, particularly through railway and energy sector reforms, and addressing labor market rigidity to improve Total Factor Productivity Growth (TFPG). Education reforms are proposed to increase accessibility and quality, alongside electricity sector restructuring to reduce transmission losses and improve industrial supply. The paper also advocates for liberalizing Foreign Direct Investment (FDI) regulations, integrating India into global supply chains, and strengthening governance with improved public goods provision and accountability mechanisms. Overall, the reforms aim to accelerate productivity growth, foster inclusive economic development, and position India for sustainable global competitiveness.