Indian equities climbed to a fresh high Monday for the second time in less than a week as parliament opened ahead of a budget expected to see the announcement of long-term reforms.
"People are looking at the budget as the start point of a continuous reform process," said
Economists expect the budget to contain a credible outline of steps to steer
Since winning a landslide election in May, Prime Minister
While there has been a public outcry,
The Sensex has risen more than eight percent since Modi took office in June and more than 23 percent in 2014 as it became increasingly likely that his right-wing
Still, analysts say Modi will struggle to shrink a yawning fiscal deficit and add that he faces the challenge of spiralling inflation as food prices soar on the back of a weak monsoon.
"We expect the main policy push to materialise only next year once the administration is firmly established and has dealt with near-term challenges such as poor rains," said
"Once adopted, it will also take some time before the reforms yield their expected growth dividend," it added.
Growth has slowed from near double-digits a few years ago to 4.7 percent in 2013, marking the second straight year of sub-five percent expansion, hit by high interest rates, falling investment and wage-eroding inflation.
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