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Last updated: 03 Oct, 2017  

Meeting.9.thmb.jpg Can PM's advisory council revive growth?

NITI Aayog member Bibek Debroy
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Bikky Khosla | 03 Oct, 2017

Prime Minister Modi last week revived the Economic Advisory Council, which has been defunct since the NDA came to power in 2014. The five-member council, comprising economists of high repute and to be led by NITI Aayog member Bibek Debroy, will address the issues of macroeconomic importance and present its views directly to the PM. It is interesting to see the reconstitution of the UPA-era council by the current government after three years coming to power, but the decision sounds welcome, though belated, in the backdrop of the recent slowdown in Indian economy.

There is little doubt that the first challenge of the PMEAC would be to work on what needed to be done to revive the economy, and its success would largely depend on the Prime Minister's perception about the current economic challenge. At the national executive meeting of the ruling party last week, the generally expressed view was that the current crisis is temporary. This view does not seem to hold much water, however. Majority of economists believe that the ongoing decline is more structural in nature and a mere stimulus package to boost short-term growth will hardly work. The effectiveness of the council would therefore depend on how the PM sees the current downturn.

Meanwhile, senior BJP leader Yashwant Sinha last week lashed out at finance minister Arun Jaitley for making a "mess" of the economy. Initially, the debate was on the state of the economy, but it soon turned into ugly personal attacks between two responsible politicians belonging to the same camp. This is unfortunate. The four major concerns--banking sector NPAs, slump in private investment, faltering manufacturing activity, and unemployment--raised by Sinha have repeatedly been pointed out by economists and the Centre should think of their solutions instead of going in to a denial mode.

In another development, in a recent meeting with corporate leaders and industry bodies, Commerce Minister Suresh Prabhu said the government would form a review committee to bring down the regulatory issues faced by industry. It was also decided that a mechanism would be formalized for periodical interactions between the  industry bodies and the government. Such initiatives are always welcome. Additionally, the government should also pay urgent attention to the teething troubles facing our small businesses after implementation of GST.

I invite your opinions.

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Development of Export from India
Tarunendra Nath Banerjee | Sat Oct 7 13:13:13 2017
The Current status of Export Statistics show a downward trend.The picture is not encouraging.The recommendations from the newly revived Economic Advisory Council is welcome.The strengthening of Bipartite Agreements and its implementations is the only the silver lining of expectations of development.

PM's advisory council
Gautam Kumar Das | Fri Oct 6 12:33:11 2017
Besides present Global Market trend (cloud based digital business and automation) we must be very much careful about our days old heritage/business strength/infrastructural base etc. considering India as a whole/considering all the Indian communities. The win-win economic activity base lines of all the Indians should not be derailed. New related and unrelated approaches are always welcome but it should match with the Indian Cultural fabrics and the gain we have achieved after independence. PM's€™ advisory council should have politically unbiased intellectuals/scientists/Technologists/Doctors etc. Say for example in case of Thermal Power Plants introduction of FGD & SCR have been made mandatory as to control SOx & NOx levels in the atmosphere but there are no stipulations for Co2 capturing /emission control to mitigate climate crisis, which is more critical.

Not at is the reason why??
YM | Thu Oct 5 11:35:27 2017
From the past 2 years indian economy is in the doldrums. One could by no chance think that it was ready for demonetization and GST result is it tanked very badly. The GDP growth rate is even lower than it is projected due to change in certain paramaters by the government from 2015. The real figure is far too low. Even after making such a mess the PM is bragging about the past that the current state of the economy is better than it was during the UPA rule. I want to ask him what about the ACCHE DIN he promised before the lok shabha elections. This government has let down & screwed the people of this country.This is why this govt. is facing heat from within the party as well. Seniors leaders like Yashwant Sinha, Arun Shourie have the guts to raise their voices against the wrong doings by the govt. I know many other leaders are also their who agree with them but they dont have strength to raise their voices. This is sending a wrong message in the public. The PM talks about the 2024 elections but I wonder he should first think of winning the 2019 lok shabha elections. The oppositon parties also must unite with congress party and must project Dr. MANMOHAN SINGH as their candidate for prime minister in the next elections.People are ready to vote against the BJP but they dont have any alternate at this time.People are not ready to vote for pappu, the congress party must accept this fact. The earlier they accept the truth the more easier would be for them to win the nxt elections.

  Re: Not at is the reason why??
RPSINGH | Mon Oct 9 12:09:26 2017
I think we should must have patience. The government has made certain changes which are going to give long term benefits Indian economy is not affected immediately. We should watch and see. No doubt it may take time but definitely we must see better future.GST and demonetization were the need of hr for future prospective India. The most of economic problems are of UPA generated and for the rectification of the same it was necessary to implement GST and demonetization.The Govt has taken write steps to rectify the past economic troubles which have precipitated now.It is BJP where voices come out side not like other parties where no body can speak. The emergency of 1971 is the example. In India nobody wants to give tax and if government brings GST then all people go against. Every medicine or surgery is painful but it brings relief. Demonetization and GST are surgery to our post bad and corrupt economy. Please wait nothing is wrong .

Ease of import.
Ananda Rangan | Wed Oct 4 15:00:30 2017
Please ease the Customs Duty Drawback refund scheme and make it simple and fast as possible. SME customers will get the benefit and export will increase and will eventually help to revive the economy. Now, their money is locked up in the Government endlessly and no reimbursement to expect in the near future.

GST and economic slow down
Ananda Babu J | Wed Oct 4 11:55:41 2017
Reverse charge on GST should be discontinued. Refund of GST should be fast. GST on advance receipts to be discontinued. Govt should not be enriched with trade and industry money. It should refund the eligible but should not restrict it to take input credit. Rates of GST on certain items to be lessen. for example in restaurants GST is very high. I feel most of the small and medium restaurants do not pay the GST collected from customers to the Government but charging to customers. Number of returns to be reduced. Banks to change the norms for NPA so that small and medium sector units can be revived which actually creating employment. Due to severe NPA norms most of the industries are suffering for working capital limits. The slogan of PM Make in India is not working in India as the land prices, conversion prices, power charges are very high and corruption is very high in India in several states where infrastructure facilities are good.

Can PM's advisory council revive growth?...I doubt.
S Prakash | Wed Oct 4 07:27:16 2017
Sir, I have read your earlier articles as well and your words are discouraging but true and seem to be pointing in the right direction. They always seem like a wake up call for the entire Industry and The Indian commune at large. And you know, For the last 2 years (there was a speck of hope in the 1st year) it has been extremely disheartening to listen to the manipulated News items , subsequent elite discussions on AIR FM and blown-up propaganda launched by almost all the Ministers including our PM (always fooling us with MERE PYARE BHAIYON...ALL IS WELL...), because none of the hype that they continue to feed us actually corresponds to the state of affairs of our economy. Our FM, Mr Arun Jaitley is in Bangladesh and today he will be addressing the Reps. of Bangladesh Industry on the success stories of demonetization, implementation of GST and falsely boasting on ever-growing Indian economy. We all know that Isn't that shameful for a minister. All I know is that, when a person of the calibre and experience of Dr Manmohan Singh - who has been RBI Governor for 3 years, Deputy Chairman of Planning Commission for 2 years, Finance Minister for 5 years and Prime Minister for 10 years, points out that the economy is faltering, and in return Arun Jaitley ji has the kidneys to blabber that Dr Manmohan Singh and the opposition does not understand the importance of his ingeniously devised financial policies.... THEN THERE IS SOMETHING DRASTICALLY WRONG WITH THE CURRENT GOVERNMENT.

Agree with the editor
Shyam Sundar Damaani | Wed Oct 4 06:27:56 2017
I feel Jaitley has totally missed the train. GST was a great opportunity to simplify business in India. And he has made it as draconian, complex, unplanned,unfeasible for SME as possible. Small business people were already burdened with over 10-15 departments and now GST equates one department equal to 15 departments. Its time consuming and complex. Software accross all industries are not ready yet for intricacies of the different business types. What was the need of RCM,E Way Bills, nearly 40 returns,etc. to be implemented in the first phase. It was good to be implemented in 2020. It is wrong political and economic move. Small ppl r distressed. big one's will have no issues. Their big chain of employees & professionals would take care. But where the entrepreneur is involved in day today accounting, it shall create a distaste for business and kill entrepreneurship. Secondly we business people are the most productive asset of the country. Its we who pay taxes and support the economy & pay for every expense of the government. If we are treated like thieves, then who is the well wisher left. Compliance has become a big business and business has become more of compliance. No time for growth matters and other critical issues. Personal life of small trader is completely squeezed out !! No wonder if few commit suicide, due to unpaid loans and business failures. LET PEOPLE DO BUSINESS FREELY.

Uninterupted power supply
Yogesh Gosavi | Wed Oct 4 06:20:49 2017
Even after 3 years we are not able to get uninterrupted power for the industry. Avg every day we waste 3-4 hrs of production for power failure. This is case near PUNE.I can not imagine starting business in other rural areas. when you cant give power Maitri platform and all other promises remain promises only. Ridiculous and disgusting....we are fade up.

Not at all
A V Chandran | Wed Oct 4 05:52:34 2017
Can PM's advisory council revive growth? Not at all! India has a culture of mixed micros and macros economy whereas existing one in force is closely related to capitalist like Mukesh Ambani as his business grown up to 58% for the last two years whereas Indian GDP stands fallen at 5.7%, imports shoot up and exports recorded worst fall. These are all happened in the absence of Planning Process and continuous review mechanism. The Govt of India must deeply examine the merits and demerits of Planning Process and continuous Review Mechanism of mixed economy. Once it is examined the result with restoration of Planning Process and Continuous Review Mechanism, continuous economic development of the Great Nation could be achieved! Secondly Govt must ensure that Black Money of Indians in Swiss Banks is part and parcel of the Great National Developments and it is not at all wealth of other countries. Thirdly Non Plan Expenditure must support corresponding Non Plan Revenue and abnormal deviation between the two factors will have direct economic repercussion. Once All the above Three factors are in place, excellent economy of the Nation could be achieved in all respects.

We are closing down
Tensingh Sivakumar | Wed Oct 4 05:40:45 2017
Time is already out. We are closing down the apparel unit this month. Very sad ....this government let us down very badly. GST is the reason big units are not placing Job orders with us. For the rent alone we have paid more GST than our actual income, so there is no way we can run the unit than to close the unit.

M Shankar Iyer | Wed Oct 4 04:48:20 2017
Though it is good but in practicality SMEs are more suffer and affected in their establishment growth. Affected people are always middle class which please make a note.

Growth rate
JKM | Wed Oct 4 04:35:08 2017
Possible when purchase power increases ,which catapults manufacturing activity that would help the dead growth we see everywhere,cut down excess levies,service taxes,empower people financially by lowering prices,of essential day to day goods,items for human living in phases boost people with enthusiasm to feel they are secured.

Good to share that important matter in public
Ravi Kant Soni | Wed Oct 4 03:55:54 2017
It is good one to share that important matter in public. Even if doing nothing but showing worried about the matter is same. As I feel about the government. I feel that in the government except Mr. Modi no one coming in the front to start initiative. Modi Sir need to be empower there minister. In this government showing willingness to do something better but unfortunately the same was not implemented effectively, because people and govt. followers are confused about there intention. PM focusing to industrial growth and make in India while there supporter engage to internal communal issue. That is deviating the message. I think we need to understand what is first thing we need to do for make in India and accordingly we need to be provocative on the same

Jaitley is cleaning mess
Shashank | Wed Oct 4 03:33:47 2017
Economy is greatly affected by misrule of UPA. This was the era when public money was looted by unscrupulous businessmen with support of ruling party. It has resulted in huge NPA problem. This NPA was kept under carpet by congress but Jaitley dealt with this firmly. So in fact he is cleaning the mess created by UPA. Mr. Sinha has been loyal bhakt of Advani who don't miss any occasion to attack Modi Govt. His comments are not worthy of consideration. It's dirty mudslinging only.

  Re: Jaitley is cleaning mess
SJS RAVI | Mon Oct 9 12:39:53 2017
Mate, you are buying the wrong story. The NPA story is old. NPA has not much to do with corruption or loot. It is when we stir the pot of economy without looking at the consequences, we have stalled projects and/or abandoned projects, in which the banks have already sunk fortunes. If at all, the NPAs have been multiplied by the present regime rather than reducing it in any way by their anti business, holier than thou attitude and empty pro poor talk. Bankruptcy laws are no use. It is like giving freedom to at least some of the culprits to get away without any penal consequences. Bankruptcies have to be checked at the root by nurturing businesses and not by destroying them. Whether one is a Bhakt or not of Advani or Yashwant Sinha the situation is plainly that of a sinking economy. I speak from my experience of running small enterprises for nearly five decades. Bluster is no use. If the Govt comes out of delusions of its own making and stops believing in what it says for propaganda, there is some chance for us. Otherwise also we have already missed the bus. Now we will be chasing the cloud of dust left behind in some misguided hope.

Growth and Economy Reformation
Pradeep Parameswaran | Wed Oct 4 03:28:41 2017
A Country like India any change will take its own time to reflect top its top due to the complexities of this economy, For a country like India Government should re think about Toll System exists in this country, which lags our growth at least 2 to 3 Hrs every day, if you multiply this with our Resource wastage that itself can be utilized for the present growth, so in spite of accumulating to the treasury government should spend to minimize the obstacles and provide a better plat form to public & private sector growth.

Incentivise SMEs projects
Bhagawath Prasad | Wed Oct 4 03:18:44 2017
Need of the hour is fund those unfunded , more importantly , fund those short-funded , incentivise SMEs those expanded , withdraw all litigated cases in courts and tribunals , return all the money that is taken by government through litigated notices,simplify GST filing , stop sending notices to SMEs , let banks fund liberally for those they have expanded in anticipation of growth.

They can, provided, they are seriously interested
Manotosh Kr Datta. | Wed Oct 4 03:03:54 2017
I am very sure they can, provided, they are seriously interested. They have to work for current "Indian economy" and then improve without any bias. We can always hope, at least, something new are coming within a year because 2019 is election year, all parties will be ready with their "drums" and "trumpets".

Need a crisis committee
Suryaprakash | Wed Oct 4 02:30:57 2017
A crisis committee need to be formed with full authority comprising of the software companies and SME CEOs and thrash out the GST issues on war footing. controls and regulations have to be brought in in banking sector to monitor the loans given.A griculture sector-high level committee need to be formed to spur growth

Mayank Desai | Wed Oct 4 02:02:23 2017
Simplify the method and make maximum two slabs. The idea of one country one tax has gone to mess instead of benefits. All small traders facing crisis. They welcomed GST but now coursing so make it easy ASAP. Exporters in pain for refunds and worried that capital stuck with Govt again worried when it will come? and will corruption take place to get their own money back!! Please act faster. Watch .. as too many cooks spoil the soup too many reforms together spoil the economy and mood of people. I am in favour of reforms but I personally feel it is too fast€™. Please check.

R S MANI | Wed Oct 4 00:23:04 2017
Government spending on development Projects should be increased so that the Private Sector will come forward to participate in the said Projects in larger way to get the benefits of such spending, which will create employment especially in RURAL AREAS, WHERE LOT OF UNEMPLOYMENT EXISTS. RAJAJI's Plan of " EARN WHILE LEARNING" " from School Days has been shelved and this has created students even from Villages seeking white collar jobs, shunning jobs requiring hard physical labour or in the skill in which they can engage themselves. Honesty has been eroded in the last 50 years and hence it will take time for the younger generation and equally the Industrialists to realise that as per the current GST system and AADHAR SYSTEM, it is not possible to manipulate business transactions and THE RIGHT METHIOD , by obeying the laws, WILL ONLY TAKE THEM ahead and prosperous. If every one realises, including politicians and Industrialists, IAS OFFICERS, EXECUTIVES, EMPLOYEES, Traders, etc. Our Nation will definitely prosper, since Govt. Spending will increase by getting more revenue for development , increasing basic amenities in Villages, Towns etc.which in turn will generate employment. Government spending in EDUCATION WITH SKILL DEVELOPMENT SHOULD INCREASE IN MANY FOLDS LIKE GERMANY. INVITE GERMANY AND JAPAN TO INVEST IN THE DEVELOPMENT OF IMPARTING KNOWLEDGE IN SCHOOLS AND COLLEGES IN PRACTICALS COUPLED WITH THEORETICAL EDUCATION. PEOPLE ARE NOW AFRAID OF DOING WRONG HENCE SLOWDOWN.

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