Chief Economic Adviser Krishnamurthy Subramanian on Saturday exuded confidence of India becoming a $5 trillion economy in the next five years.
“Even though the target [from existing $2.7 trillion] looks ambitious, it is realistic and achievable considering multiple successes in all domains of governance in the last five years,” the CEA said.
He was addressing the Assistant Collectors under Training of 2018 batch allotted to Telangana, Military Engineer Services Probationers, Group-I Officers of Telangana State, senior officers from Madhya Pradesh and other Trainees at Dr MCR HRD Institute in the city.
A release from the Institute said in his presentation on the theme of “The State of Indian Economy”, Mr. Subramanian said investments would be the key driver to reach the target. Besides giving a big boost to industry, services and business, investments would create innumerable jobs for all sections of society, including those economically weak, thus making the process of development and growth truly inclusive.
Speaking on measures needed, he said many enterprises preferred to stay small to benefit from incentives and thus their growth was lower compared to their real potential. He underlined the importance of providing incentives to those enterprises which have the real potential to grow at a rapid pace.
The States, he added, should usher in labour reforms enhancing the threshold of employee number to increase their productivity. Citing Rajasthan as a successful example of enhancing productivity, he said the State had enhanced the limit of employees to 300 from 100 to benefit from Labour rules. “The productivity in this case increased from 3.65% to a staggering 9.33%, after reforms,” he added. In the longer run, larger firms have greater potential for employment generation and the MSMEs run the risk of becoming less impactful in job creation.
Director General of Dr.MCR HRD Institute B.P. Acharya said while encouragement to large industries is important, micro, small and medium enterprises should not be ignored considering their substantial role in generating employment and poverty reduction, the release said.
