Steps on to create conducive investment environment: CEA
Terming the current slowdown more cyclical than structural in nature, Chief Economic Advisor (CEA) Krishnamurthy Subramanian said, here on Monday, the government had been taking steps, like the corporate tax rate cut, which were aimed at creating more favourable investment and growth environment.
Speaking at the 'FICCI Young Leaders Summit: The New Indian for a New India', Subramanian said private investment was the key driver of economic growth and consumption a force multiplier.
Stating that the government has a well-thought-out agenda for reforms, he said, "The current slowdown is a lot more on the cyclical side. The steps we are taking are intended to create a more favourable environment for investments, required for sustained growth."
Amid the second quarter gross domestic product (GDP) growth dipping to 4.5 per cent, Finance Minister Nirmala SItharaman had said she would respond sectorally, wherever required, to push demand and consumption.
Subramanian said, "Needless to say there is a slowdown. But you estimate whether it's cyclical or structural by estimating the potential growth rate of the economy. If the growth potential has changed because of some structural aspects of the economy, then you can say the slowdown is structural."
There had been no change in demographics, demand, and companies's ability to supply things, he said.
"The government is doing a lot of reforms to enhance productivity of the economy. We are taking all steps that are necessary," Subramanian said.
Talking about the importance of treating data as a public good, the CEA said, "Data is of the people, by the people, and hence should be for the people." The government should also promote the use of soft infrastructure, like data infrastructure, he added.
The CEA pointed to the enormous potential of artificial intelligence and machine learning in business. "High-quality data is extremely important for machines to learn well and make predictions about the right business decisions," he said.
Subramanian remarked that technology had been changing the nature of jobs for long and urged the government to support the retraining of people to learn new skills.