Attributing decline in economic growth to "slow governance" and faulty allocation of natural resources, RBI Governor Raghuram Rajan has said GDP will improve to 7 per cent in next three years on back of political stability.

"The sharp slowdown in GDP from 8-9 per cent growth to 4-5 per cent in the last two years was caused by issues such as environment and land acquisition problems, delays in withdrawal of fiscal and monetary stimulus, irregularities around allocation of natural resources and slow governance," a report quoted Rajan as saying.