“2025 has been a good year in terms of reforms, with measures like the New Labour Code and GST reforms,” Sinha said. “Now, the focus should move to something more long-term but really required to push India to the next leap of growth. That would be an increased focus on R&D and innovation.”
Sinha highlighted that India’s spending on R&D remains low, at around 0.7% of GDP, compared with 2.5 to 3% in other innovation-led economies. Private sector participation in R&D, she noted, is only about 36%, whereas in global innovation hubs it can be as high as 70%. “India has the best brains, and the focus should be on inculcating a culture of innovation in the economy,” she said.
On structural reforms, Sinha emphasised the importance of tapping into India’s demographic dividend. “We have a large workforce. How do we employ them productively? How do we create enough jobs? How do we skill them adequately?” she asked. Sinha suggested that moving workers from agriculture into higher-value sectors like agri-processing, horticulture, floriculture, or expanding agri-exports could raise productivity. She also pointed to the services sector, suggesting diversification beyond IT and business consulting, for instance through tourism, to absorb more workers.
Sinha also said that encouraging foreign direct investment (FDI) will be crucial for growth. “Measures like land reforms, easing regulations, and improving ease of doing business will really help,” she added.
Also Read | PM Modi chairs economists’ meet at NITI Aayog ahead of Budget; exports, capex in focus
The comments come after Prime Minister Narendra Modi met a group of eminent economists and sectoral experts to seek their views on the upcoming Union Budget. Sources told CNBC-TV18 that discussions focused on measures to increase exports, land reforms, and the global trade situation. Methods to boost household savings and address rising household debt were also on the agenda. Economists reportedly urged the government to continue its capital expenditure push and offered suggestions on structural reforms. Finance Minister Nirmala Sitharaman was also present at the meeting.
With 2025 marking a year of major reforms, including the GST overhaul, labour code reforms, and the introduction of the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, experts like Sinha say the next budget should aim to lay the foundation for long-term, innovation-led growth.
