India to witness a double digit growth rate of around 10% for FY2021-22, says Dr Arvind Virmani at PHD Chamber’s programme on Shadow Budget 2021-22

No. PR- 191

January 15, 2021

New Delhi

India to witness a double digit growth rate of around 10% for FY2021-22, says Dr Arvind Virmani at PHD Chamber’s programme on Shadow Budget 2021-22

Dr Arvind Virmani, Renowned Economist, and Chair, EGROW, projected that India will witness a double digit growth rate of around 10% for FY2021-22. He said that this rebound in GDP growth is attributed to the proactive reforms undertaken by the Government. He stated that post the effective implementation of reform agenda of the Government, the country will record around 7.5% of growth over next decade. He emphasized on the importance of MSME sector with respect to employment creation and exports. For boosting the growth of MSMES, he suggested the direct tax and indirect tax codes should be simplified. He said that India needs 21st century tax codes to support Aatmanirbhar startups and MSMEs. He stated that the external sector reforms complements internal sector reforms. He appreciated the production linked incentive scheme and recommended that PLI scheme should be supported with tariff reforms. He said that India should sign more FTAs with USA, UK and Euro Area to enhance its position in the global supply chain and to drive export growth. He opined that the unemployment rate has somewhat normalized post lockdown, however, indoor and contact services still needs revival. In regard to welfare reforms, he recommended welfare stack, welfare card and direct benefit transfer schemes. He opined that pubic healthcare systems needs to revamped and sewage system needs to be modernized, swatch Bharat mission needs to be broadened and health education should be made more prevalent since the school level.

Shri Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry, mentioned that the manpower issues in police, judiciary and health need to be concentrated upon in the Union budget 2021-22. He talked about the indices introduced by the PHDCCI to track the growth trajectory of the Indian economy over the last few months. He mentioned about the trinity of the Stimulus of Policy, Financials and Confidence instilled by the Government during the last 9 months have enhanced the economic activity at significantly higher level, the December month economic activity based on the composite index of three broad economic indicators including GST collections, Passenger Vehicle Sales and SENSEX is at its 33 months high. He then mentioned about the EBM index and appreciated the Government for pulling the economy from the low growth of (-)23.9% in Q1 FY 2020-21 to the overall growth of (-)7.7% in FY 2020-21 in the extremely difficult time of Pandemic COVID-19. At this juncture, to continue the recovery momentum of economic and business activity, immediate policy attention is required towards credit access to industry and services sectors. Credit disbursement should be the top most priority at this juncture by the banking sector.

PHD Chamber of Commerce and Industry organized a program on Shadow Budget 2021-22 in virtual cum physical mode, today at PHD Chamber of Commerce and Industry.

Dr Charan Singh, Renowned Economist and Chief Executive, EGROW, opined that the Government should allow pensioned to use LTC benefit to revive the demand and kick start the economic growth. He said that India should have a fiscal policy committee and a fiscal institution. He suggested that in post COVID times, there will be a need to focus more on mental health. He recommended that there should be synergies between MSMEs and NBFCs.

Dr. Rattan Chand, Director, EGROW and Former Chief Director, Monitoring and Evaluation, Ministry of Health and Family Welfare, Government of India, emphasized on need of changing lifestyle and adopting a healthy one. He suggested that there is a need to increase healthcare expenditure as percent of GDP for strengthening Research and Development, infrastructure, manpower and logistics requirement.

Dr. Askok Vishandass Director at EGROW and Former Chair of CACP (Commission for Agricultural Costs and Prices), Ministry of Agriculture and Farmers Welfare, Government of India said that Farmers income have to be increased with the increase in farm productivity. He also said that Agriculture has the potential to contribute to demand. India needs Stable agriculture trade policy. Organic produce of agriculture exports need to be bolstered.

Col M P Singh, Defence Analyst, highlighted his Expectations from the budget that spending on defence to increase between 12%-15% of Rs 60-62 thousand crore of allocation as compared to last year. Reversing of trend in increase in revenue expenditure and decrease in capital expenditure. Rather it should increase capital expenditure. Budget fillip towards make in India. Private sector needs to be encouraged in production of small arms in India. The rate at which arms and ammunitions are imported in India, if manufactured within India would be half the rate of imports and would add to the pool of savings that could be invested in other sectors.

Shri Pradeep Multani, Senior Vice President, PHD Chamber of Commerce and Industry, said that he Government has been working proactively to revive and rejuvenate the trade, industry and economy from the dynamic and difficult times caused by health and economic impact of COVID-19. Over the years, India has been continuously improving in World Bank’s Ease of Doing Business Rankings and has jumped by 79 spots from 142nd rank in 2015 to 63rd rank in 2020 among 190 economies. At this juncture, working on the low scoring factors for the country in respect of registering property, payment of taxes and enforcement of contracts would prove to be transformational for India.

Shri Sandeep Aggarwal ji, Chair, Industry Affairs Committee, PHD Chamber said that the development of a robust manufacturing sector must be a key priority of the Government with significantly enhanced contribution in GDP. The focus must be on greater allocations towards Research & Development (R&D) as it helps in strengthening global competitiveness with productivity improvements. Furthermore, extreme support to MSMEs and Startups is required to help them recover from the daunting impact of pandemic COVID -19. He added that promotion of the manufacturing sector and creation of a conducive manufacturing ecosystem will not only enable better connectivity with global supply chains but also establish backward linkages with the MSMEs sector in the country leading to overall growth in the economy and creation of huge employment opportunities.


Media Division

PHD Chamber of Commerce and Industry