Bibek Debroy said the council has identified major priorities for accelerating growth and employment
Acknowledging an economic slowdown, Prime Minister Narendra Modi's newly-constituted Economic Advisory Council has picked 10 areas to work on first, with a focus on accelerating growth and jobs. Economist Bibek Debroy, who heads the five-member panel, chaired the first meeting of the council today, with the government's Chief Economic Advisor Arvind Subramanian making a presentation.
Here is your 10-point cheat-sheet to this story:
- Mr Debroy, who is also a member of plan body Niti Ayog, said the council has identified major priorities for accelerating growth and employment over the next six months, identifying 10 themes around which detailed reports will be prepared by its members in consultation with government ministries and departments.
- The need for "effective tracking of key economic parameters through possible mechanisms for instituting an economic tracking monitor using lead indicators and triggers for action and based on informed assessment and analysis" was also discussed. The other areas identified include informal sector and integration, fiscal framework, monetary policy, public expenditure, institutions of economic governance, patterns of consumption and production, and the social sector.
- "We will give our recommendations to the Prime Minister," said Mr Debroy, emphasising that it will be an "exercise of teamwork," and that the council will use resources of government departments like the Niti Aayog. The council would provide professional inputs into the policy making process, members said. PM Modi has already identified a few specific areas and asked the council to work on them, said Ashima Goyal, one of the members of the council. The council will respond quickly and come out with concrete, doable solutions, she added.
- The next formal meeting of the Economic Advisory Council will be held in November. Panel member Surjit Bhalla said the council's next focus will be on the Budget.
- PM Modi set up the Economic Advisory Council last month amid concerns over a slowdown as economic growth slumped to a three-year-low of 5.7 per cent in the June quarter.
- Yesterday, the International Monetary Fund (IMF) lowered its growth projection for India to 6.7 per cent, from 7.2 per cent, in 2017, attributing it to demonetisation and the introduction of national tax GST. The IMF however said the slowdown is a "blip" and India will regain the tag of the world's fastest growing major economy, projecting the economy to grow at 7.4 per cent in 2018.
- The government has been attacked by political rivals and by former union ministers like Yashwant Sinha and Arun Shourie over the June quarter slump and over what the opposition has called poor implementation of GST.
- Finance Minister Arun Jaitley, who is in the US to attend annual meetings of the IMF and the World Bank, said the transition to GST has been "fairly smooth" despite attempts by "ill-informed" Opposition leaders to derail its implementation.
- In a speech last week, PM Modi defended his economic policies asserting that fundamentals are strong and that the government is committed to reversing the setback of the June quarter. PM Modi stated that a "handful of people" are trying to spread a contagion of pessimism based on the slowdown of the June quarter.
- The Economic Advisory Council is made up of top economists. Apart from Mr Debroy, who is also a member of plan body NITI Aayog, it includes Surjit Bhalla, Rathin Roy and Ashima Goyal. Ratan Watal, principal adviser of NITI Aayog, is the member secretary of the council.
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