"A stable government post-elections cannot be taken for granted...it would be dangerous for parties to postpone necessary legislations with the idea of passing the legislation post-election. Post-election politics may become even more challenging for whoever assumes power," he said.    

Rajan, who was speaking at the Delhi Economic Conclave 2013 on ‘The Agenda for the Next Five Years’, said that delays in putting large, stalled projects back on track or an additional fiscal slippage would only amplify the challenges that the new government will face.

"It will benefit the economy if Parliament passes key bills and if current authorities take action to improve growth and fiscal health, including raising diesel prices to market level and eliminating other poorly targeted subsidies," he said.

The RBI Governor further said that in the absence of a stable government after the elections, due early next year, political parties would have to work together to meet the challenges facing the economy, otherwise the markets and rating agencies may not be kind to India.

Rajan said economic growth seems to be stabilizing.
    
“We are seeing some glimmerings of stronger growth. But it’s too early to say we have certainly hit bottom. But I am hopeful that (growth) would be around 5 percent,” he said.

The country's economic growth slowed to decade low of five percent in the previous financial year.

(Agencies)

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