India’s Reform Push Is Real — But Confidence Is Fragile
Bhalla’s warning cuts through the cheerleading: India still needs faster reform, but the latest FDI data shows the bigger issue is confidence, not collapse.
India’s economic debate is being pulled in two directions. In his Indian Express column, Surjit Bhalla argues that the government needs to speed up reform and stop leaning on upbeat slogans, especially on growth and investment. His core claim is political: a comfortable ruling coalition can afford to delay hard choices, even when private investment stays weak and foreign capital looks elsewhere (
The Indian Express). That is the leverage point. The government controls the reform tempo; investors decide whether India’s rules are worth the risk.
The real fight is over investor confidence
Bhalla’s argument resonates because the investment climate is now the central policy battleground. He says India’s 2015 bilateral investment treaty rewrite made the country less attractive to foreign investors and that the government’s own political dominance has reduced the urgency to fix it (The Indian Express; 
India Today). That framing is useful, but it is not the whole picture. The latest data cited by The Hindu shows gross FDI crossing $88 billion in April-February FY26 and potentially reaching $90 billion for the full year, while February net FDI turned positive after six negative months (
The Hindu; The Hindu).
That matters. It means India is not seeing an investor walkout; it is seeing volatile flows, higher repatriation, and a market that still needs clearer rules. The difference is important for policy: a collapse would call for crisis management, while volatility calls for credibility.
New Delhi is trying to fix the signaling problem
The government clearly knows this. In early May, the commerce ministry issued an updated SOP setting a 12-week cap for processing FDI applications, while also tightening scrutiny for sensitive sectors and investments from particular countries (The Hindu). That is the kind of administrative reform investors actually notice: predictable timelines, fewer surprises, and a more legible approval process.
At the same time, the 2026 Economic Survey has pushed an explicitly pro-investor line, urging India to learn from Southeast Asian models that combine faster clearances, industrial policy, and stronger supply-chain positioning (
The Straits Times). That is the real policy consensus emerging in Delhi: keep public capital flowing, but make private capital less nervous.
For readers following this through 
India and Global Politics, the key point is that reform is now being judged less by intent than by execution. India can still attract capital on scale, but it is no longer enough to claim momentum; it has to prove that rules will not shift midstream.
What to watch next
The next test is whether Delhi moves beyond procedural fixes and into politically harder reforms: land, labor flexibility, tax certainty, and treaty architecture. Watch the June policy calendar and the next FDI readout. If gross inflows stay strong while net FDI remains choppy, the government will have to decide whether it wants headline comfort or a deeper investment reset. Bhalla’s argument is that delay is now the main risk. The data says the same, just more politely.
