HOME > MARKETS > ECONOMY NEWS
  ECONOMY NEWS
ECONOMY
New government must ensure fiscal consolidation, privatisation of PSUs: Panagariya
May-22-2019

In order to fast-track India’s Gross Domestic Product (GDP) growth, Eminent Indian- American economist Arvind Panagariya has recommended that the new government must show strong commitment to fiscal consolidation, consolidate central ministries, go for aggressive privatisation of public sector undertakings (PSUs) and create a new international trade negotiation entity.

Eminent Indian- American economist has stated that the next government must show strong commitment to fiscal consolidation to ensure that private sector is not starved of investment funds. He also said that reducing the number of central ministries to 30 is another important thing that the new government would like to do to make it in line with international standards and improve the efficiency of the governance. Recommending privatisation of one PSU every week, he said this is feasible since over two-dozen PSUs already had a cabinet approval.

Panagariya also called for amending the Banking Regulation Act through an ordinance to allow the Reserve Bank of India (RBI) to restore its February 12, 2018 circular or equivalent, aimed at putting a lid on the future creation of non-performing assets (NPAs). He noted that accelerate cleaning up of NPAs and infuse capital into Public Sector Banks (PSBs) do ensure that healthy credit growth returns.  

  RELATED NEWS >>