Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

Economic slowdown a concern, need to push growth, jobs: PM’s advisors

Note4students

Mains Paper 3: Indian Economy and issues relating to planning, mobilization of resources, growth and development, employment.

 

From UPSC perspective, the following things are important:

Prelims level: Fiscal Deficit and Fiscal Consolidation

Mains level: Steps to revive economy

 


News

Context-

  1. The article talks about the newly constituted Economic Advisory Council to the Prime Minister. It also talks about the future roles of this council.

  

What is the PM-EAC?

  1. The Prime Minister’s Economic Advisory Council was first set up in the year 2004 by the then PM Dr. Manmohan Singh. However, in 2014 it was disbanded by the government.
  2. The re-constitution of the PM-EAC came in the backdrop of growing concerns over the pace of growth in the economy and the slow pace of job creation.
  3. This council consists of Bibek Debroy (Chairperson) and members as Surjit Bhalla, Rathin Roy, Ratan Watal and Ashima Goyal.

 

What are its tasks?

  1. The council recognised the need to accelerate economic growth and employment over the next six months.
  2. The Council recognised the need for instituting an Economy Track Monitor, using lead indicators and triggers for action, based on informed assessment and analysis.
  3. It will provide specific recommendations for tackling the economic slowdown.
  4. The EAC identified ten themes on which reports will be prepared:
  5. economic growth;
  6. employment and job creation;
  • informal sector and integration;
  1. fiscal framework; monetary policy;
  2. public expenditure;
  3. institutions of economic governance;
  • agriculture & animal husbandry; and
  • patterns of consumption & production and social sector.
  1. The Council will work in consultation with various stakeholders, including sectoral ministries, states, experts, institutions, regulators and the private sector.

 

The council has consensus on two things:

  1. There is economic slowdown in the country, we need to look into the causes.
  2. The government should not breach the targets of fiscal consolidation and fiscal deficit (3.2 per cent of GDP for current financial year).

 


Back2basics

  1. Fiscal Deficit: A Fiscal Deficit occurs when government’s total expenditures exceed its total revenues (excluding borrowings).
  2. Fiscal Consolidation: The steps taken by government to reduce its fiscal deficit and debt are known as Fiscal Consolidation. This includes raising taxes, dis-investment in PSUs, rationalisation of subsidies etc

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