My question is that what improvement in introduction of a paper or other parts of paper the authors should do when the reviewers wrote the following sentence:
The authors have missed many important state of the art references
Thanks in advance
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I think the statement is very clear. Wether your literature research was incomplete or the reviewer just wants two of his own papers cited once more, we cannot tell.
Make sure you can exclude the first possibility, then try guessing, and either be bold in your rebuttal letter, or cite some more.
(If the reviewer gave no hint to specific references, I'd suspect that you might have a somewhat grave problem: Either you paper is indeed crappy, or that reviewer just doesn't want it published, or wants it delayed, for his own good.)
I recommend that you do the following:
The advantage of this approach is defensive: when you do eventually submit your completed revision, it would be very difficult for the editor to reject your article based on insufficient references. At the very least, if that is the only problem that would otherwise lead to a rejection, I would expect them to give you at least one more round to revise your paper according to the references that the reviewer would then explicitly list. (And if the reviewer still does not explicitly list the missing references, then you would be justified to politely say, "I have tried my best to respond.")