Crisis? At India forum, it's back to business as usual

The word "reform" has been touted in India for years but if discussions at the World Economic Forum are anything to go by, Asia's third-largest economy may have turned a corner with its political will to help it reach 9-10 percent growth rates.

With the re-elected Congress-led government freed from the shackles of communist support, reforms from foreign investment in retail to recycling India's $400 billion in domestic savings to help fund infrastructure projects were seen as real possibilities.

Aside from 2005-2008 when India's economy expanded by more than 9 percent annually, the Asian giant has struggled to keep up with China's breakneck growth, hampered by infrastructure bottlenecks, red tape and an often plodding financial system.

"There is now political stability," said Saurabh Agrawal, head of investment banking for Bank of America Merrill Lynch in India. "The government is making the right noises and it looks like there is political will."

Congress's May general election win, recent state victories and a weak opposition have freed the hands of reformists in the government, including Prime Minister Manmohan Singh.

"India is in a sweet spot," one senior banker said, as the centre of gravity over the last year has leaned towards emerging economies, while Western economies struggled to stay afloat.

"If you want a high rate of return, where would you invest? Europe? Brazil? Russia? China?" he added, referring each time to their economic or regulatory problems. "India does stand out."

Singh set the tone on Sunday, saying that clear signs of an upturn in the economy were laying the path for the expansion of long-term debt markets, deeper corporate bond markets, stronger insurance and pension sectors, and improved futures markets.

At a host of conference sessions, calls for reform resonated around the rooms -- foreign investment in universities, making highway concessional contracts better for private investors, changes to quicken court cases over contractual disputes.

Investors have also been buoyed by plans this week to sell stakes in profit-making state companies.

Many said they had heard all this before.