India's economy could achieve growth of 10 per cent in 2011 if the government persists with reforms, including privatisation of state firms, the OECD said yesterday.
In its first survey of the Indian economy, the Paris-based Organisation for Economic Co-operation and Development said India needed to relax its labour laws, remove a cap on foreign investment in the insurance sector and undertake wide-ranging reforms to boost growth.
"The impressive response of the Indian economy to past reforms should give policymakers confidence that further liberalisation will deliver additional growth dividends," the OECD said in the report released in New Delhi.
The Indian economy, Asia's third-largest, has grown at an average 8.6 per cent in the past four years but reforms such as further opening the economy to foreign investment and the privatisation of state firms have stalled due to opposition from supporters of the ruling coalition.
The economy is expected to grow by 8.5 per cent in the financial year ending in March 2008, according to the central bank.
The OECD restated it expected economic growth to slow to eight per cent in 2008 due to the effect of higher interest rates.
International ratings agency Standard and Poor's said the Indian economy is likely to grow 8.6 per cent in the fiscal year ending in March 2008. ( Gulf )