{
"values": [{
"fname": "Neha",
"sname": "Prabhu",
"subjects": ["eng", "bio", "phy"]
}, {
"fname": "Pooja",
"sname": "Naik",
"subjects": ["eng", "chem", "phy"]
}]
}

How can i parse the inner list (“values”) and outer list(“subjects”) from json in most efficient way?

by parse do you mean get some access from script?  For an array, you can loop thru contents like this, assuming your json is in $_json variable:
@0 = ^query(direct_sv $_json values ?)
loop()
{
$_object = ^first(@0object)
... do something with this object
e.g. $_object.fname would print out that value
}

By parsing, i mean i want to print he values of the json object:

I want the output as “Neha Prabhu opted for the subjects eng, bio and phy”

$$tmp = ^jsonopen(GET $$url “” $$user_agent)
  @1 = query(direct_v ? fname ? 1)
  @2 = query(direct_v ? sname ? 1)
  @2object @1object opted for the subjects

  $subjects = ^jsonpath(.values.0.subjects ^jsonparse( $$tmp ))
  $no_of_subjects = ^length($subjects)
  $count = 0
  $limit = $no_of_subjects- 1
  loop( $no_of_subjects )
  {
^jsonpath(.values.0.subjects.$count ^jsonparse( $$tmp ))
$count += 1
if ($count < $limit) {, }
  if ($count == $limit ) { and }
  if ($count == $no_of_resp ) {.}
  }

I was able to do it using the above code, but instead of using jsonparse I want to use @0 = ^query(direct_sv $_json values ?), how can i do it?

Jsonopen automatically parses the response into JSON facts so you can reference them directly.
I prefer to not use queries and just iterate normally.

$_tmp = ^jsonopen(transient GET $$url “” $$user_agent)

$_numpeople = ^length($_tmp.values)
$_indexpeople = 0
^loop($_numpeople)
{
$_object = $_tmp.values[$_indexpeople]
$_object.fname $_object.sname opted for the subjects

$_numsubjects = ^length($_object.subjects)
$_limit = $_numsubjects - 1
$_indexsubject = 0
^loop($_numsubjects)
{
$_object.subjects[$_indexsubject]
if ($_indexsubject < $_limit) { , }
    else if ($_indexsubject == $_limit) { and }
    else { . }
    $_indexsubject += 1
  }

  $_indexpeople += 1
}

$_tmp.

Thanks a lot Andy Heydon. This was very helpful