The Prime Minister’s Economic Advisory Council today outlined 10 priority areas to accelerate economic growth and employment over the next six months.
At its first meeting since the five-member panel was set up last month, the Council identified economic growth, fiscal framework, job creation, and monetary policy, as some of the major issues that it will work on, Chairman Bibek Debroy told reporters after the meeting.
The panel’s focus won’t be on policy rates and any suggestions it makes on monetary policy will be in consultation with the Reserve Bank of India, Debroy clarified.
He said that the panel will make “specific implementable recommendations” to the Prime Minister. “It is not not our job to push those recommendations or even take them to the finance ministry. We work for the PM,” he added.
The 10 areas of work identified by the group were:
- Economic growth
- Employment and job creation
- Integration of informal sector
- Fiscal framework
- Monetary policy
- Public expenditure and efficiency
- Institutions of economic governance
- Agriculture and animal husbandry
- Consumption and production patterns
- Social sector
While there are existing governing bodies looking at each of these areas, the advisory council will work in “collaboration and consultation” with them to make recommendations, Debroy said. Each member will prepared detailed presentations on one of the identified areas that’ll be presented before the Council in its next meeting in November, he added.
The PMEAC is an independent body designed to guide the government on policy decisions. The government has drafted NITI Aayog Member Bibek Debroy as the chairman, Surjit Bhalla, Rathin Roy and Ashima Goyal, all of whom are part-time members, and Ratan Watal, principal adviser, NITI Aayog, as the member-secretary.
The constitution of the panel comes at a time when India’s economic growth has slowed to a three-year low in the aftermath of demonetisation and and ahead of the implementation of the Goods and Services Tax regime. Lack of private sector investments, mounting bad loans in the Indian banking system and a widening fiscal deficit have compounded the slowdown. This has increased pressure on the Modi administration to spur investments, create jobs for India's expanding workforce and kickstart growth.
There is a consensus among the Council members about the various reasons which have led to a slowdown in the economic growth rate, Debroy said while refusing to identify a specific reason.
The panel has been constituted for the first time since Modi’s election victory. The previous economic advisory council under Manmohan Singh had resigned in May 2014 after his term ended, as stipulated by norms.