- 15 injured as makeshift tent collapses during Modi's Midnapore rally, PM visits hospital.
- Our government working to double farmer income by 2022: PM Modi
- Journalist Upendra Rai arrested by CBI in fresh case of alleged corruption: Officials
- Kerala church scandal: SC to hear tomorrow anticipatory bail plea of priest
Need tools to revive growth in short term, says CEA
Chief Economic Adviser Arvind Subramanian says our economy has seen an across-the-board deceleration in activity which requires policy makers to come up with all the possible tools to revive growth.
The likely growth this fiscal will be towards the lower end of the 6.75-7.5 per cent band suggested in January-end, mainly because of downside effects of factors like the appreciation of the rupee, farm loan waivers and transitionary challenges from implementing GST, he said.
The only upside possibility is exports growth.
“Farm loan waiver will be deflationary exerting a drag on growth in short run... We are not changing the growth forecast, but we are saying that because of all these risks it is less likely that we will see outcomes towards the upper end of the forecast,” said Subramanian.
Addressing reporters after the Economic Survey-2 was tabled in Parliament, he said there was an “across-the-board deceleration” in real economic activity since the first and second quarters of last year.
“There are very favourable medium term developments. The real challenge now is short term growth and how we need to respond to that. We need to bring to bare all the policy tools we have to revive short term growth,” said Subramanian, the author of the Survey.
For the last 10 months, he said, inflation figures have come out better by about 150 basis points than the target that was set.
“End March inflation is going to be well within target and average inflation for year as a whole is going to be well below target. Average inflation for year will be closer to 3 per cent,” Subramanian said.
Outlining the benefits of demonetisation, he said there are early signs as cash usage in the economy has come down.
“Has cash come down in economy? We seem to have achieved a 20 per cent reduction in the equilibrium cash holding which means that the cash-GDP ratio has come down by about 1.6 percentage points and this was one of the objectives of DeMo. It is something quite substantial that has been achieved,” he said.
He further said that 5.4 lakh additional taxpayers were added during post demonetisation, November 8-March 31.
“It represents about 1 per cent of taxpayers. It led to increase in number of taxpayers. The reported taxable income has not gone up by as much because many of these new filers are reporting a taxable income around the threshold. So whether this increase in taxpayer will lead to increased taxes remains to be seen,” Subramanian said.
Stating that providing remunerative minimum support price (MSP) for crops to farmers was needed, he said policies that prop up market prices above MSPs need to be looked at.
“In the policy mix we have to ask whether some forms of direct support could be part of policy mix. This farm stress has happened at the time of plenty,” he added.
- Business Corner 17 Jul 2018 | Agencies
- India’s inflation mounts to 54-month high 17 Jul 2018 | IANS
- India earns Rs 18K cr per year from export of basmati rice 17 Jul 2018 | PTI
- Britannia rolls out Rs 170-cr unit in Assam; to hire 1,000 persons 17 Jul 2018 | PTI
- Infosys shares end nearly 2 pc up after Q1 earnings 17 Jul 2018 | PTI
- Data belongs to individual users, says TRAI urging strong safeguards against misuse 17 Jul 2018 | IANS
- JLR launches F-TYPE sports car 17 Jul 2018 | PTI
- Rupee slips six paise against US dollar 17 Jul 2018 | PTI
- India Inc’s Jan-Jun deal tally at $74.8 bn on big-ticket deals 17 Jul 2018 | PTI
- LIC gets board’s nod to buy majority stake in IDBI Bank 17 Jul 2018 | PTI
Sunday EditionView All
15 Jul 2018 | PTI | New Delhi
Amid row over alleged use of derogatory language in a web series while referring to former Prime Minister Rajiv Gandhi, Congress chief Rahul Gandhi on Saturday said the BJP and the RSS believe that freedom of expression must be policed, while he regards it as a fundamental democratic right. “My father lived and died in the service of India...
STATE EDITIONSView All
17 Jul 2018 | Staff Reporter | Bhopal
Phir Khule Akaash me Judde Ghataon Ke, Phir Hawaon Ke Dupatte Ho Gaye Jheene, a poetic event centered on creations about monsoon ‘Pranaam Pawas’ concluded in city. The event was organised by the Dushyant Kumar Memorial Manuscript Museum to welcome the monsoon season...