KOLKATA: Government’s Chief Economic Adviser (CEA) V Anantha Nageswaran said India is in a stable position and the pace of development is good despite several crises being simultaneous and engaging with each other. Speaking virtually at the annual session of the Indian Chamber of Commerce (ICC), CEA said that the world is passing through a ‘polycrisis’ which is characterized by multiple crises of high inflation, monetary policy tightening, high interest rates, slowdown in China . Which affected the global supply chain and the Russo-Ukraine War.
“The challenges the country is facing since the Second World War are unprecedented. But India is in a stable position and the pace of growth is good. India’s growth rate in 2022-23 will be from 6.5 per cent to seven per cent, which is That is, despite the high inflation rate of 7.4 per cent, it is considered good.”
Nageswaran said at this juncture India needs to maintain macroeconomic stability, increase foreign exchange reserves and their judicious use and finance the trade deficit due to high imports of crude oil.
He said, “Financing the trade deficit due to high crude oil imports is a challenge for the country. FDI inflows are stagnant, while portfolio investment has become volatile as USD is becoming attractive due to high interest rates in USA. is,” he said.
The CEA said that though India has become the fifth largest economy in the world, there is a need to increase the per capita income of the country. Nageswaran said there are signs of resumption of employment in the formal sector and there are signs that investment is picking up.
“Banks and corporates’ balance sheets look better and trimmed and not bloated,” he said, adding that lenders’ NPS has also declined.
Nageswaran said that banks are now giving loans and credit is growing at the rate of 17 per cent.
He said that in the immediate past, targeted support was given to the MSME sector in the form of credit guarantees, while several government schemes like the PM Garib Kalyan Yojana ensured social stability in the country.
Nageswaran said privatization is back in the lexicon of policy makers after 20 years.
“Privatization is back in the policy framework after 20 years. It is still a work in progress and will take some time. Many stakeholders are not feeling comfortable with it. There is a need to unlock enterprise efficiency and the states also have to come. Will be on board,” he said.
He said the government’s National Monetization Plan (NMP) has the potential to unlock Rs 6 lakh crore by monetizing the assets of non-productive PSUs.
The CEA also said that the northeastern states will have to strengthen their economy through service sector, agricultural products and tourism.
He said that digitization has helped in formalizing the Indian economy and digital infrastructure is in both public and private hands, which is the right balance.