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By Rajesh Kumar Singh and Douglas Busvine JAIPUR, India (Reuters) - The reformist government that many Indians and free-market flag-bearers had hoped would emerge after this year's election isn't in New Delhi - at least not yet. The desert state of Rajasthan, derided as a poverty-stricken laggard, has taken the lead on structural reforms that, their backers argue, could also help Asia's No.3 economy as a whole to attract business and employ a fast-growing workforce. Chief Minister Vasundhara Raje has shaken up labor, land and welfare policies with such verve Prime Minister Narendra Modi, a party ally, has even poached her chief of staff and put him in charge of the federal finance ministry. "We have to open up every single employment opportunity." Rajasthan and the rest of India face other obstacles besides a freer labor market: woeful infrastructure, red tape and corruption.