NEW DELHI: Acknowledging that the economy is in the midst of a slowdown, the Prime Minister’s Economic Advisory Council on Wednesday identified 10 key areas to revive growth and boost job creation in the next six months.
The council+ , headed by NITI Aayog member Bibek Debroy, zeroed in on themes that included economic growth, employment and job creation, informal sector and integration, fiscal framework, monetary policy, public expenditure, institutions of economic governance, agriculture and animal husbandry, patterns of consumption and production and social sector.
“We will come out with implementable solutions for economic problems and present them to the Prime Minister,” Debroy told a news conference after the first meeting of the panel. The chief economic adviser in the finance ministry, Arvind Subramanian, gave an overview of the economy and various policy options to boost growth.
The council was set up by PM Narendra Modi shortly after growth slowed to a three-year low of 5.7% in the quarter ended June+ . This was followed by several downgrades to growth projections by economists and multilateral agencies. The PM had opted not to set up an economic advisory council when he assumed power in May 2014.
The Debroy panel said there was a consensus that the government should stick to the fiscal consolidation roadmap and not go for a stimulus at the cost of fiscal prudence. Asked about the lack of jobs in the economy, Debroy said there was no reliable data available and the panel would examine the issue. Over the next one month, the panel is likely to work on various issues in the run-up to the budget for 2018-19.
“There is a consensus (among the members)… that the fiscal consolidation exercise should not be deviated,” Debroy said when asked whether the government should provide a fiscal stimulus. The economic slowdown has triggered calls for a fiscal stimulus to revive growth but several economists and policy-makers have said the government should not deviate from the path of fiscal consolidation. The Council’s reports would be structured in the coming months and developed by theme groups, led by its members, through “consultative processes involving sectoral ministries, states, experts, institutions, private sector and other key stakeholders,” a government statement said after the meeting.
Another key issue recognised was the need for effective tracking of key economic parameters and setting up an economy track monitor, using lead indicators and triggers for action, based on informed assessment and analysis. It was also agreed that specific issue papers will also be brought out by members to address key concerns and linkages will be established with key national institutions. “The deliberations of the new economic advisory council to the Prime Minister also reflect its value addition as an independent institutional mechanism, to provide inf ormed advice to the Prime Minister on addressing issues of macroeconomic importance and related aspects,” the government statement said. “It is clear that this Council is focused on critical interventions related to accelerating economic growth and employment over the next few months,” it added.