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India's new government will pursue a broad economic reform agenda focused on job creation through public and private investment that also makes containing inflation its top priority, President Pranab Mukherjee told parliament on Monday.
The president told lawmakers elected in Modi's landslide victory last month that the government would introduce a general sales tax, encourage foreign investment and speed up approvals for major business projects while tackling bottlenecks that make India's food inflation the highest among major economies.
The anti-inflationary message will be welcomed by central bank governor Raghuram Rajan who has made India's growth-stifling high interest rates contingent on containing consumer prices.
Mukherjee said returning to a path of high economic growth after several volatile years was paramount.
Asia's third-largest economy grew by 4.7 percent in 2013/14, marking the second straight year of sub-5 percent growth and the longest such slowdown in more than a quarter of a century.
The government will "urgently pursue" reforms to the state-run coal sector and to the defense industry to attract private investment, the president said, while speeding up project clearances to promote labor intensive manufacturing industries.
Some 10 million people enter the country's workforce every year as the largest youth bulge the world has ever seen reaches working age. The demographic shift may help propel India into the league of developed nations but could lead to economic and social disaster if it is not harnessed effectively.
Modi's government also promised to ensure that every Indian family has a good home with uninterrupted supplies of power by 2022. It will urgently seek to revamp India's creaking railway system, with a focus on high speed trains, as well as road and airport building.