New Delhi. National Democratic Alliance (NDA) leader-elect Narendra Modi will take oath as India's Prime Minister for a historic third term at 7:15 pm today. After running a full majority government for a decade, Modi will now run a coalition government with the Telugu Desam Party and the Janata Dal (United) being the key partners. However, despite the coalition, experts feel that the economic agenda of the new government will not change much.

Economists believe that the pace of reforms in Modi 3.0 will remain the same as before and will not slow down. Also, to achieve the goal of developed India by 2047, economic reforms and policy review will need to continue in many sectors including infrastructure, labor and manufacturing.

Need to focus on infrastructure

M Govind Rao, member of the Fourteenth Finance Commission and former director of the National Institute of Public Finance and Policy, said, 'The government is aiming to become a developed country by 2047. For this, far-reaching reforms will have to be done in the market. Emphasis will have to be laid on opening up the economy and developing infrastructure. Also, there should be an emphasis on increasing labor-based manufacturing.'

Govind Rao said that it is obviously not easy to carry out large-scale reforms in a coalition environment, but the government should focus on these things. Economists have said that coalition politics may lead to increased spending on populist measures. The government will continue to focus on "Made in India" reforms. Sectors like infrastructure and manufacturing will remain the priority of the government.

Populist spending will increase

"There is likely to be a shift towards more populist spending. States of coalition partners may get more resources. But India's public finances are relatively strong and will be bolstered by significant reserves from the RBI. India's infrastructure spending will continue at a rapid pace, but probably with greater private sector participation," said Gautam Sen, a retired political economist at the London School of Economics and author.

The budget will reveal the agenda

The full budget to be announced in July will reveal the economic agenda of Modi 3.0. Many economists expect the budget to mainly see a boost in welfare and support schemes for farmers and the poor. The budget will indicate the policy priorities for the new coalition government and set the development direction for the next five years.