New Delhi: With economic growth hitting a trough and the World Bank and the International Monetary Fund downgrading thir growth forecast, economist Rathin Roy, a part-time member of the newly-formed Prime Minister’s economic advisory council, on Wednesday made light of the IMF’s projections, claiming 80 per cent of IMF’s projections were “wrong”.
The council, formed by Prime Minister Narendra Modi last month, held its first meeting on Wednesday, and Mr Roy’s comments came at the press conference which followed the meeting.
“IMF’s growth projections are 80 per cent wrong... The World Bank’s growth projections are 65 per cent wrong,” he said, when asked to comment on the lowering of growth projections by multilateral lending agencies.
The council’s chairman, Niti Aayog member Bibek Debroy, refused to divulge “certain issues” referred to it by the PM, but said there was consensus among members on the aspects that have hampered growth. The council, at its meeting, identified 10 key themes around which it will structure its report in the coming months. Among these are job creation, economic growth, agriculture, social sector and fiscal framework.
Asked why the council was set up in the fourth year of the NDA government at a time when growth is sluggish, economist Surjeet Bhalla — also a part-time member of the council along with Mr Roy and Ms Ashima Goyal — said two years back the economy was stable, whereas the mandate of the council was to “accelerate” growth in the context of the present times, and thus it was set up now.
Mr Debroy said the council will by next month prepare reports on at least five of these subjects. He refused to divulge which would be the five key issues out of the 10 recognised by it.
When asked what would be the recommendations of the council on these key issues, an evasive Mr Debroy said those will be for the Prime Minister’s consumption and would not be announced through the media.
“We will come out with implementable solutions for economic problems and present them to the Prime Minister,” he said. Replying to queries on job creation, Mr Debroy admitted “whether we like it or not, we don’t have good data on employment”. He added: “In a country like India, you can’t get good data on jobs and employment from enterprise surveys. The labour bureau enterprise surveys cover less than 1.5 per cent of total employment.”
Noting that data on unemployment and employment in India was available only through household surveys, he said the last NSSO household survey was out in 2011-12, while the next results of NSSO household surveys will not be available till 2018.
Earlier this week, the International Monetary Fund had lowered India’s growth forecast for the current fiscal by 0.5 percentage points to 6.7 per cent, while the World Bank pegged economic expansion at 7 per cent, down from 7.2 per cent projected earlier.
The Asian Development Bank too has lowered India’s current fiscal growth to 7 per cent from 7.4 per cent, while the RBI cut its economic growth forecast to 6.7 per cent from earlier projection of 7.3 per cent.
