Government processes in India take too long and the country needs to change regulations that govern business, Raghuram Rajan, Chief Economic Advisor in the Finance Ministry, has said.
"Things are difficult in India; we have to improve the business climate and reduce the regulations that govern business. Some of our regulations come from British times, we need to change that... We need a thorough revamping of these rules," Mr Rajan said on Sunday.
The government is trying to build ways to get over the problems and according faster clearances to business projects, he added.
"Government processes take too long. That's why we have set up new structures to try and accelerate the process. And even those structures take some time for teething, to find their way... Rome wasn't built in a day," Mr Rajan told a private news channel.
The Cabinet Committee on Investment (CCI) has cleared projects worth $25-30 billion since January, he said, adding that there was a need to attract more investments, create jobs and boost growth.
He said the macro-economic condition is showing signs of improvement, with inflation coming down, and that would give space to the Reserve Bank of India (RBI) to lower rates. RBI is slated to announce its mid-quarter monetary policy review on Monday, June 17.
The WPI inflation fell to a 43-month low of 4.7 per cent in May, while the retail inflation (CPI-based) was at 9.31 per cent.
"The fact that inflation is coming down, we still need to see CPI inflation coming down a little more, but that should give the RBI more room to cut interest rates which then will flow into the economy and allow us to grow a little faster," he said.
Mr Rajan said he expects the economy to clock over 6 per cent growth in the current fiscal year.
"We have taken many actions which have made the economy more resilient... We created the environment for more investment... We need to keep doing more," he said.
The Indian economy grew at a decade's low level of 5 per cent in 2012-13.
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