New Delhi: India's economic growth performance is 'good' and efforts will be needed to maintain it now as there are concerns about the external environment, Sanjiv Sanyal, member of the Economic Advisory Council to the Prime Minister (EAC-PM), said. Are not completely resolved. Said on Thursday.
Sanyal said that if weather conditions and monsoon remain favourable, it is expected that food prices will also come down. This will create conditions that will be quite favorable for a growth pace of 7 percent or more, which can be pursued even under somewhat uncertain global conditions.
"My argument is that our current economic growth performance is quite good. Now the game is to be able to maintain that," he said in an interview.,
India's economy grew at a better-than-expected 8.4 per cent rate in the last three months of 2023 - the fastest pace in a year and a half.
The growth rate in October-December was higher than 7.6 per cent in the last three years, and this helped lift the projection for the previous fiscal year (April 202 to March 2024) to 7.6 per cent.
Recently, the Reserve Bank has maintained the GDP growth estimate for the financial year 2024-25 at 7 percent.
"...While we are very confident about the pace of domestic growth in our economy, there are certainly concerns about the external environment that are not fully resolved," he said.
Sanyal said that exports remain very weak and there is no momentum in global exports. Furthermore, "Recently, oil prices had soared...to US$91 per barrel due to tensions in the Middle East due to the destruction of Russian oil facilities by Ukrainian attacks and a number of other reasons," EAC- PM said.
Asked about long-term solutions to high food prices, Sanyal said high food prices are largely not a production problem, but actually a storage problem."After all, Singapore and Dubai do not grow tomatoes and onions. The prices of their onions and tomatoes do not rise the way ours do here and every year they grow some vegetables or others, onions, tomatoes, potatoes, whatever. , something's gonna happen, G is moving off the charts," he said.
Emphasizing that investment in storage also means that private markets in agriculture become more vibrant and stronger, Sanyal said, this issue can be solved by states by devising different types of mechanisms for storage of vegetables. Is.
“Of course, import and export of food items is also an issue.But yes, but this (high) vegetable price issue… ultimately the solution to this issue is private market and storage.”
When asked why foreign direct investment in India is slowing down, Sanyal said that this is not happening only in India, but there has been a significant decline in foreign direct investment across the world.
“But looking at the inquiries, the projects we are getting that are underway, I am quite sure that the underlying momentum of FDI is very, very strong,” he said.
According to OECD data, India's share in global FDI fell from 3.5 per cent in the first nine months of 2022 to 2.19 per cent in the same period in 2023.
The sharp decline of 54 per cent is much larger than the 26 per cent decline in overall global FDI inflows in the first nine months.Responding to a question on India's China-plus-one strategy, he said India needs to create conditions to create adequate capacity for certain types of industries.
Sanyal pointed out that Apple has not only shifted its iPhone manufacturing facility to India, but it has also shifted a large ecosystem here. “A lot of larger companies are in the process of moving forward,” he said, adding that it will take some time.
Answering a question on unemployment in India, Sanyal said that the real thing is that there is a need to create jobs.
Emphasizing that growth is ultimately the most important solution to unemployment, he said it is therefore absolutely vital to enhance this growth over the next several years.Sanyal said he does not believe that there is such a thing as jobless growth in the medium to long term. He said, "All growth ultimately creates jobs. You can have skills mismatch. You can have all kinds of other problems, but you cannot create jobless growth over a long period of time."
According to a recent report by the International Labor Organization (ILO), more than 80 percent of India's unemployed workforce consists of youth.
Sanyal said that if weather conditions and monsoon remain favourable, it is expected that food prices will also come down. This will create conditions that will be quite favorable for a growth pace of 7 percent or more, which can be pursued even under somewhat uncertain global conditions.
"My argument is that our current economic growth performance is quite good. Now the game is to be able to maintain that," he said in an interview.,
India's economy grew at a better-than-expected 8.4 per cent rate in the last three months of 2023 - the fastest pace in a year and a half.
The growth rate in October-December was higher than 7.6 per cent in the last three years, and this helped lift the projection for the previous fiscal year (April 202 to March 2024) to 7.6 per cent.
Recently, the Reserve Bank has maintained the GDP growth estimate for the financial year 2024-25 at 7 percent.
"...While we are very confident about the pace of domestic growth in our economy, there are certainly concerns about the external environment that are not fully resolved," he said.
Sanyal said that exports remain very weak and there is no momentum in global exports. Furthermore, "Recently, oil prices had soared...to US$91 per barrel due to tensions in the Middle East due to the destruction of Russian oil facilities by Ukrainian attacks and a number of other reasons," EAC- PM said.
Asked about long-term solutions to high food prices, Sanyal said high food prices are largely not a production problem, but actually a storage problem."After all, Singapore and Dubai do not grow tomatoes and onions. The prices of their onions and tomatoes do not rise the way ours do here and every year they grow some vegetables or others, onions, tomatoes, potatoes, whatever. , something's gonna happen, G is moving off the charts," he said.
Emphasizing that investment in storage also means that private markets in agriculture become more vibrant and stronger, Sanyal said, this issue can be solved by states by devising different types of mechanisms for storage of vegetables. Is.
“Of course, import and export of food items is also an issue.But yes, but this (high) vegetable price issue… ultimately the solution to this issue is private market and storage.”
When asked why foreign direct investment in India is slowing down, Sanyal said that this is not happening only in India, but there has been a significant decline in foreign direct investment across the world.
“But looking at the inquiries, the projects we are getting that are underway, I am quite sure that the underlying momentum of FDI is very, very strong,” he said.
According to OECD data, India's share in global FDI fell from 3.5 per cent in the first nine months of 2022 to 2.19 per cent in the same period in 2023.
The sharp decline of 54 per cent is much larger than the 26 per cent decline in overall global FDI inflows in the first nine months.Responding to a question on India's China-plus-one strategy, he said India needs to create conditions to create adequate capacity for certain types of industries.
Sanyal pointed out that Apple has not only shifted its iPhone manufacturing facility to India, but it has also shifted a large ecosystem here. “A lot of larger companies are in the process of moving forward,” he said, adding that it will take some time.
Answering a question on unemployment in India, Sanyal said that the real thing is that there is a need to create jobs.
Emphasizing that growth is ultimately the most important solution to unemployment, he said it is therefore absolutely vital to enhance this growth over the next several years.Sanyal said he does not believe that there is such a thing as jobless growth in the medium to long term. He said, "All growth ultimately creates jobs. You can have skills mismatch. You can have all kinds of other problems, but you cannot create jobless growth over a long period of time."
According to a recent report by the International Labor Organization (ILO), more than 80 percent of India's unemployed workforce consists of youth.
