PMEAC acknowledges slowdown, identifies 10 priority areas

Economic Advisory Council to PM Narendra Modi to meet for first time tomorrow

PM's Economic Advisory Council to hold first meeting today

Prime Minister Narendra Modi's Economic Advisory Council member Rathin Roy on Wednesday dismissed International Monetary Fund's (IMF) slashing of India's growth projection for 2017, noting they are "estimations" which are "wrong 80 per cent of the time".

The EAC-PM was formed under the chairmanship of NITI Aayog Vice Chairman Bibek Debroy, with Ratan Watal, Principal Advisor to the planning body, named Member Secretary of the Council. In order to revive an upward growth in the next few months, the Council will focus towards the budget that is likely to be presented in the next 3-4 months.

He said that the council will take inputs from RBI and Monetary Policy Committee while considering issues related to monetary policy framework.

"We have identified 10 themes that we would initially work on till we have our next meeting one month from now", Debroy said. These include economic growth, job creation, fiscal framework, monetary framework, social sector, the institution of economic governance among others.

The council which held its first meeting here PMEAC chalked out the major priorities for accelerating economic growth and employment while accepting that the country is witnessing a slowdown.

Another Council member Rathin Roy said that "the consensus is there is economic slowdown, we will examine its causes".

The Council has been set up with the approval of the prime minister on September 26, 2017.

On joblessness front, Debroy, however, said whether we like it or not we don't have good data on employment.

The Council wants the Modi government to stick to its fiscal consolidation road map and has suggested that a stimulus to the industry should not be at the cost of fiscal prudence.

Instead, at the council's first meeting on Wednesday, members listed 10 policy priorities for the government in the run-up to the presentation of 2018-19 budget.

"IMF's growth projections are 80 per cent wrong.World Bank's growth projections are 65 per cent wrong", he said in a media interaction when asked to comment on lowering of growth projections by worldwide multilateral lending agencies.

If the government does not deviate from its target of reining in its fiscal deficit at 3.2 per cent of the gross domestic product (GDP), providing stimulus would be nearly impossible.

The Asian Development Bank too lowered India's current fiscal growth to 7 per cent from 7.4 per cent, while RBI cut economic growth forecast to 6.7 per cent from earlier projection of 7.3 per cent.

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