Savings and capital formation in India
- Ila Patnaik & Radhika Pandey
- Jun 2019
- National Institute of Public Finance and Policy (NIPFP)
- India
High levels of savings and investments are key to India’s sustained and robust long-term growth. While India’s saving rate has declined in recent years, a bigger challenge facing the economy is the intermediation of savings to finance the growing requirements of industry and infrastructure. The paper highlights the issues in infrastructure and MSME financing and proposes an agenda for reforms. In addition, it suggests that reduced financial repression, deep and liquid bond markets, improvement in banking regulation, improved access to bank credit to MSMEs should be the agenda for financial sector reforms.
