The Paris-based economic institute urged the government to loosen "restrictive" labour laws and "inefficient" regulation of product markets, continue privatisations and simplify the country's tax systems.
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It also suggested increasing competition in the financial market sector and concentrating public action on boosting public investment in infrastructure and improving education and development measures for the poor.
"The government's target of reaching GDP growth of 10 percent in 2011 is achievable if reforms continue," the report from the Organisation for Economic Cooperation and Development concluded.
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The Indian economy expanded by 9.4 percent last year, the fastest in 18 years, but the OECD estimated that "potential" growth -- a sustainable growth level that can be achieved without high inflation -- is only 8.5 percent.