THE ECONOMIC Advisory Council to the Prime Minister (EAC-PM) in its first meeting Wednesday stressed on the need to "accelerate economic growth and employment over the next six months" and identified 10 areas on which it will prepare reports and make recommendations to the government over the next few months.
The council also assessed that the government needs to provide some sort of fiscal stimulus to revive economic growth.
The Council's primary and the only role is to advise the Prime Minister Narendra Modi on the macroeconomy, Debroy added.
Debroy said there was a consensus among the members about the various reasons for the slowdown of the economy.
The meeting, chaired by Bibek Debroy, was also attended by leading economists Dr. Surjit Bhalla, Dr. Rathin Roy, Dr. Ashima Goyal and Member Secretary Ratan P. Watal, who was also the former Finance Secretary and Principal Adviser to NITI Aayog.
Chief Economic Advisor Arvind Subramanian, in his presentation to the EAC, focussed on accelerating economic growth, including investments and exports, using a combination of different policy levers.
Mr. Debroy said patterns of consumption and production and social sector are among other issues on which the council will work.
The five-member Council was unanimous that the government shouldn't stray from the path of fiscal consolidation, thus ruling out a fiscal stimulus to reverse the downturn in the economy.
For the current fiscal year, the government of India has budgeted a total expenditure of Rs 21,46,735 crore, tax revenue of Rs 12,27,014 crore, non-tax revenue of Rs 2,88,757 crore, recoveries of loans of Rs 11,932 crore and other capital receipts of Rs 72,500 crore. "We will also have another formal meeting next month and give recommendations to the prime minister", he said. The PM had opted not to set up an economic advisory council when he assumed power in May 2014.
India's economic health deteriorated due to the growth data which slipped to a three-year low of 5.7 per cent in the first quarter of the current fiscal.
While the International Monetary Fund has lowered India's growth forecast for the current fiscal by 0.5 percentage points to 6.7 per cent, the World Bank has pegged economic expansion at 7 per cent, down from 7.2 per cent projected earlier.
The council agreed that a specific issue paper will be brought to address key concerns and linkages will be established with key national institutions.