"We should give top priority to improve India's international rating and develop infrastructure along with removing internal bottlenecks," FICCI president O S Kanwar told PTI.
He favoured the planning commission's proposal to use foreign exchange reserves for development of infrastructure projects, saying if loans could be taken from the IMF and World Bank, then why not use the forex reserves.
"It is wrong to suggest this would lead to higher inflation. If the resources are available it is only right to make good use of them," he said.
Noting that global chains were wanting to enhance their sourcing from the country, he said it was only the lack of commensurate infrastructure, which held back the country from emerging as sourcing hub in manufacturing.
India urgently needs world-class ports and airports to inspire global investors, apart from uplift of rural areas. He said though the country was credited with having one of the largest markets, there was a need to "actually create it" by addressing the requirements of rural populace and undertaking agriculture reforms.
"We need to create a unified market, abolish mandi tax, have cold chains for world class food processing industry, invest in village infrastructure, besides undertaking steps to upgrade agriculture," he added.
Appreciating UPA Government's focus on rural development, Kanwar said the need of the hour was to take the reforms to the villages and offered industry's support in the carrying them forward.
He said FICCI had already submitted a paper on this to the planning commission besides creating a special task force for agriculture and infrastructure development.
The country should be prepared to replicate the success of IT in other services sectors including tourism, healthcare and branded retail, which will lead to large scale employment generation, he said.
Kanwar said the industry was prepared to support the government in this initiative as well as taking healthcare to rural India.
Asked about the chamber's plan with regard to manufacturing sector, he said the focus should shift from brownfield projects to greenfield projects which will result in creation of job opportunities as well as increase flow of investment.
On opposition by some sections of the industry to free trade agreements, he said while stress should be on having stringent rules of origin, India should look at entering into such agreements with developed countries like the US, European Union and Japan.
He said emphasis should be on bringing down transaction costs if the industry has to compete with that in developing countries under free trade regimes.