this balance between efficiency and stability. an organizing framework it is meaningful to analyze the performance of the indian economy over the past decade or so in terms of the simple framework displayed on slide 1. the 2x2 matrix shows four scenarios emerging from favourable and unfavourable global and domestic conditions. it is quite easy to classify the period from 2003 to 2010 into two of the boxes. the first five years of this period, i. e. the years preceding the crisis, clearly fall into the top right - hand box, reflecting favourable conditions both globally and domestically. from a growth perspective, this was a dream run for the indian economy, which averaged 8. 9 per cent per year over those five years. to illustrate the power of this rate of growth, gdp would increase by over 50 per cent during a five - year run at this rate and double in about eight - and - a - half years. many sectors in the economy have experienced the impact that this can have on the demand for their products and services. from both economic policy and business strategy perspectives, this period provides a benchmark for future performance. however, the framework should inject a dose of reality into those expectations. it highlights the fact that this rate of growth was achieved in a clearly favourable global environment, which may not be a characteristic of the next few years! getting back to the framework, the crisis period, 2008 – 10, clearly falls into the bottom lefthand box, reflecting unfavourable global and domestic conditions. the financial crisis, of which the tipping point was perhaps the collapse of lehman brothers in september 2008, was the most vivid feature of the hostile global environment, but there were several other threats that also manifested themselves in that period. food inflation soared around the world in the first half of 2008, as did oil prices. both these trends reinforced the inherent inflationary pressures that were being felt domestically as a result of the sustained high growth. in these circumstances, the monetary policy stance had to be firmly anti - inflationary, culminating in the repo rate reaching its highest ever level of 9 per cent in july 2008. the combination of global turbulence and domestic demand compression would have undoubtedly caused growth to fall, which it did. however, what may have come as a surprise is that it didn ’ t fall by very much. the economy grew by 6. 8 per cent in 2008 – 09 and by a relatively robust 8 per cent in 2009 – 10, at a time when much of the global economy was

mario draghi : structural reforms in the euro area introductory remarks by mr mario draghi, president of the european central bank, at the ecb conference " structural reforms in the euro area ", frankfurt am main, 18 october 2017. * * * it is my pleasure to welcome you all to this conference on structural reforms in the euro area. as you know, “ structural reforms ” has become something of a contested term in recent years. for many, it describes a pragmatic policy agenda to raise long - term growth and accelerate adjustment to shocks, which is essential for countries in a monetary union. but for others, the term is viewed as a “ catch - all ” for a wide range of policies, some of which have potentially negative short - run costs and adverse distributional effects. in view of these discussions, it is important to assess – first – whether countries with more flexible structures and more resilient institutions do indeed recover more quickly from shocks and grow faster over the cycle. second, we should evaluate how the design of reforms and the overall policy mix affect the impact of structural policies, especially during a downturn. and third, we should assess the distributional effects of reforms, and consider how we can ensure that they benefit everyone in society. these are the themes i will focus on in my remarks this morning. economic structures, adjustment to shocks and long - term growth first of all, the crisis has helped us better understand a key question for the euro area : are economies that are more flexible also more resilient to adverse shocks, and do they experience faster recoveries and higher long - term growth? by and large, the experience of the crisis has shown the answer to be “ yes ”. what we have seen is that more economic flexibility and sound institutions do lead to more resilience and higher longterm growth, including when countries face a common shock. indeed, euro area economies that were more flexible at the start of the crisis – as measured by the world bank doing business indicator in 2009 – subsequently showed a stronger recovery. gdp per capita rebounded faster and unemployment fell more. 1 and looking at the last 15 to 20 years – so over the full cycle – euro area countries with sound economic structures at the outset have shown much higher long - term real growth. confirming this relationship, countries that reformed their product and labour markets during the crisis have also seen good results afterwards – and the full effects are still materialising. focusing just on the labour market, a