New Delhi, December 19: India is witnessing a one of the worst economic slowdown. The government is doing its best through policy interventions, be it a big corporate tax cut or be it the merger of banks. Many economists time and again have suggested a raft of measures to be taken by the government in order to pull the economy from a bad phase.
Let us quickly have a look at what are the various suggestions these economists have passed on to the government.
Jayati Ghosh
Jayati Ghosh, a professor of economics at Jawahar Lal Nehru University (JNU) said that the government should increase its spending on employment intensive areas as the immediate problem is the lack of demand. The need of the hour is revive the demand so they should spend more on employment guarantee and agriculture on health education etc. According to her that will have a positive multiplier effect. Ghosh also added the cut in income tax is not going to help the government in beating slowdown in any sense
Raghuram Rajan
Former RBI governor Rajan has been a vocal critique of the on-going economic situation in the country. And he has been consistent in giving advises to the government. He also said that the current economic situation in the country is quite worrisome. He suggested that the need of the hour is that the current dispensation needs to address the fiscal gap and revive agriculture, power and banking sectors. He also added that India needs to cut back on needless spending and also stresses on the need to boost the demand by means of fiscal stimulus to encourage private spending.
The former RBI governor also advised that India should not immediately transition to a permanent tax cut for urban middle class to boost consumer demand.
Gita Gopinathan
Gita Gopinathan chief economist at the International Monetary Fund suggested that the government should undertake structural reforms such as bank clean up, labour reforms to address the slowdown. She also said that the time is ripe to look at the ways to manage the slowdown in domestic demand and on boosting productivity growth and supporting employment creation in the medium term.
Manmohan Singh
In order to tackle the sluggish economy, former Prime Minister Manmohan Singh also gave some important suggestions to the government. Let’s have a look at some major points from the suggestions made by Manmohan singh
Referring the demonetisation for this massive slowdown of economy Manmohan Singh said government’s trust on their banker, industrialist, invester and citizen can only led to the revive this slowdown. He came up with five-pronged strategy to beat the slowdown. He emphasised more on the rationslisation of GST, revive demand, boosting liquidity in the economy and recognising export opportunities.
Arun Kumar
Arun Kumar, a renowned professor of economics, suggested a range of measures to handle economic slowdown that is haunting everyone. Kumar suggested that government should increase public investment in education, health and rural infrastructure which will increase employment in India. He also added that government should take a step forward towards increment in allocation in rural employment guarantee schemes such as MGNREGS. He said that this NDA led BJP government should also focus on boosting the credit in micro sector that constitutes a large chunk of the population.