Noted economists and economy think-tanks reached a consensus on the GDP growth estimate at 6-6.5 percent for the next fiscal at SKOCH India Economic Forum

PRESS RELEASE

For Immediate Release
29th November 2019

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Noted economists and economy think-tanks reached a consensus on the GDP growth estimate at 6-6.5 percent for the next fiscal at SKOCH India Economic Forum

India needs to press the pedal on structural reforms to reach the goal of $ 5 Trillion economy: Dr. K V Subramanian

New Delhi: 29-11-2019: SKOCH Group (India’s topmost think-tank) organized nation’s first of its kind economic dialogue to discuss, debate and recommend to the government on achieving short-term to medium-term growth goals. Noted economists and economy think-tanks reached a consensus on the GDP growth estimate at 6-6.5 percent for the next fiscal at SKOCH India Economic Forum and that acceleration on series of structural reforms including simplification of GST, direct tax code, access of credit to MSMEs, enhancing money supply and monetisation of assets and innovation, are needed to reverse slowdown in economic growth and achieve the $5 trillion GDP target.

In his presentation on 'Outlook of the Indian Economy' at the India Economic Forum, Mr. Sameer Kochhar said the real GDP growth in the second quarter is likely to fall further to 4.5 per cent and uptake is expected only from the fourth quarter. Around 500 delegates, including top economists, policymakers and industry leaders are participating in the India Economic Forum organised by SKOCH Group.

“In the current fiscal the number is going to be around 5 per cent. But for 2020-21 at least 7 per cent growth is assured. So it's not all gloom and doom. If the structural reform measures are taken, growth will jump in the coming years. The external environment is not very kind and hence structural reforms are critical to do anything higher than that,” he said, added that to achieve $5 trillion GDP target by 2024-25, a compound annual growth of over 10 per cent would be needed. A lot needs to be done in terms of tax reforms. The GST chain seems to be quite broken. Some of these are expected to happen through the GST Council and some in the next budget.” said Kochhar while addressing the inaugural session of the Forum.

Mr. K V Subramanian, Chief Economic Adviser, Government of India; Mr. Arvind Virmani, Ssenior Economist and Former Chief Economic Adviser, and Mr. Gopal Krishna Agarwal, National Spokesperson – Economic Affairs, Bharatiya Janata Party participated in the discussions.

Dr. K V Subramanian, Chief Economic Advisor, Government of India in his address at the forum said, “We need to press the pedal on structural reforms to reach the goal of $ 5 Trillion economy. We laid down the blueprint of the $ 5 Trillion economy with special emphasis on investment with consumption being the force multiplier. India's economy grew at 5 per cent in the first quarter of 2019-20, this is the slowest pace in over six years. It is investment which is most important for growth. For continuous investment flow taxes become critical, investors evaluate risk and returns after taxes. The government recognises the need to cut the corporate tax to boost investment. Some reforms have been done in the last few years which would have salutary effects such as the changes in the Bankruptcy Code. Security and Exchange Board of India has directed that any default on the loans need to be revealed to the exchange, which will bring a lot of corrections in the system and curb the spooks caused by asymmetric information.”     

Dr. V Anantha Nageswaran, Part-Time Member, Economic Advisory Council to the Prime Minister in his key note said, “If you look at the general tendency and the marginal tendency the slowdown is primarily the result of the monetary dynamics of the country which is very weak.  Some extraordinary measures do need to be taken. We need to create liquidity window for NBFC, the way RBI has done in the past. The fiscal window needs to be created.”

Speaking at the forum Mr. Gopal Krishna Agarwal, National Spokesperson – Economic Affairs, Bharatiya Janata Party said, “GDP growth rate has been slowed down and the government is not denying this. GST has to be improved at compliance level. The biggest hindrances our industries have are in logical support, which needs big improvement.”

NOTES TO THE EDITOR

About SKOCH Group

SKOCH Group is India’s topmost think-tank for socio-economic issues with a focus on inclusive growth since 1997. Its research is accepted across political spectrum and is used for parliamentary replies as well as policy formulation. SKOCH Group specializes in action research that brings felt-need of the grassroots to the policy table. It has published seven books thus far that are valued as recommended reading. The repertoire of services includes field interventions, consultancy, research reports, impact assessments, policy briefs, books, journals, workshops and conferences. SKOCH Group has instituted India’s highest independent civilian honours in the field of governance, finance, technology, economics and social sector.

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