i am putting the important part from the article whose link i just posted which says the same thing i wrote: (a note of caution: the article is 3 years old and while much may have been achieved in urban front, rural india is still the same!) To achieve consistent 7 per cent annual GDP growth, India needs to have faster agricultural growth as well as of industry and services. Agriculture needs much more public investment and we must await the budget to see whether the Government can increase it. Growth in industry and services is throttled by red tape and poor urban infrastructure, especially roads, transport, water, sanitation and power. There is little sign of honest attempts in most states and their city administrations to improve their management and find the resources for investment. The economy has not changed since the waning days of the Vajpayee Government when India was said to be shining. It might seem to be booming today, but there are fundamental weaknesses and challenges. They range from high Government deficits, unviable enterprises, poor financial regulation, and uneconomic infrastructure pricing, ineffective delivery systems of Government, red tape, and so on. To be resolved they need politics and the Government to march in step. That they are not doing so even within the Congress, let alone its allies, is apparent. The stock markets are booming. That is no indication of a rosy future for the economy.