MELBOURNE: Reserve Bank of India governor Raghuram Rajan has suggested Australian firms to invest in the lucrative Indian market stating that India's contribution to global growth would get "bigger and bigger from here".
Rajan was talking on a wide range of issues when he asked Australian investors to tap the Indian market now.
"If anybody was to look towards a big source of demand in future it would be hard for them to miss India," he said adding "If our implementation matches our promise I have no doubt that in the next five or 10 years this will be the place to be so good to get in early".
The central bank head said "I would argue that because of the common language different accents but common language I think there could be a lot going on there".
Rajan praised the role of Australia's Productivity Commission in developing economic policy.
"Clearly there is a lot to learn about how you have used the intellectual inputs, the economic inputs, from that kind of organisation," he said in an interview with Fairfax media.
"There are so many places two large economies can learn from each other," he added.
When asked about Australian companies, like ANZ and Telstra, which have made promising investments in India in recent decades only to retreat at great cost, Rajan said "I'm not sure it's anybody's fault there have been periods of strong growth and there have been periods where people have thrown in the towel and said it is impossible doing business".
Rajan said India needed to improve its infrastructure, human capital (knowledge base of the population), regulations and access to finance.
"The gap in India has always been between the promise and the execution," he said.
"I think we are in the process of reducing that gap but we've got to keep at it," he added.
When asked if he was to consider a leadership role at the IMF in future, Rajan said "I haven't even thought about that.
The problems here and the immediacy of dealing with them is so much more interesting at this point".