This 13th India Policy Forum 2016–17 Volume comprises papers and highlights of the discussions at the India Policy Forum (IPF) held in New Delhi on July 12–13, 2016. The IPF, sponsored and organised by NCAER, invites both original empirical research and policy-focused expert reviews that define the best policy advice based on robust, empirical research. Papers appear in the annual IPF Volume after revisions based on IPF discussants’ comments, a lively floor discussion, and the editorial guidance provided by the IPF editors. The 2016 IPF Lecture was delivered by Dr Arvind Subramanian, Chief Economic Advisor to the Government of India. Subramanian spoke on “India and the Global Economy Post-Brexit.” The 2016 IPF featured a Policy Roundtable on “The Challenge of Skilling India for Global competitive”, moderated by Dr Shekhar Shah, Director-General, NCAER had Jayant Krishna from the National Skill Development Corporation, John Blomquist from the World Bank, Bornali Bhandari, NCAER and Karthik Muralidharan, University of California as the panellists.
2016 | 17, Volume 13, Papers
NEW DELHI: Economic thinktank NCAER has revised up its projection for the country’s economic growth to 7.6 per cent for the current fiscal compared with the earlier prediction of 7.3 per cent on forecast of normal monsoon.
In its quarterly review of the economy NCAER said prospects for the agricultural sector in 201718 remain optimistic on forecast of good rains.
Recent estimates show that foodgrain production in 2016 17 has touched a new record of 273.4 million tonnes or 8.7 per cent higher as compared to last year.
Also the level of water storage in the country’s main reservoirs in 201718 is better compared to last year. In fact better than the average storage over the last ten years.
“The forecast for growth of Gross Domestic Product (GDP) at market prices in 201718 is 7.6 per cent at constant (2011 12) prices” said the National Council of Applied Economic Research (NCAER).
The agency has also revised upward its forecast of GVA (Gross Value Added at Basic Prices) growth at 7.3 per cent for 201718 from its February estimate of 7 per cent.
The economy grew 7.1 per cent in 201617 lower than 7.6 per cent against 8 per cent a year ago.
The World Bank has forecast growth to be 7.2 per cent during 201718.
The quarterly report further said Wholesale Price Index (WPI) inflation is projected at 6.7 per cent for 201718.
The report also notes that while there is ample liquidity in the system and bank lending rates have come down post demonetisation bank credit is yet to pick up as it is being weighed down largely by an excess amount of gross non- performing assets on balance sheets.
The National Council of Applied Economic Research (NCAER) has revised up its projections for the country’s economic growth to 7.6 per cent for the current financial year compared with the earlier forecast of 7.3 per cent.
Similarly growth in the country’s gross value added was scaled up from 7 per cent to 7.3 per cent for the year.
Surprisingly the think tank projected the wholesale price index-based (WPI) inflation to be 6.7 per cent for 2017-18. The WPI-based inflation stood at 3.85 per cent in April which further declined to 2.17 per cent in May.
India’s economy grew 7.1 per cent in 2016-17 lower than 7.6 per cent against 8 per cent a year ago.
NCAER’s projections are shade higher than Economic Survey which projected the GDP growth in the range of 6.75 per cent to 7.5 per cent for the current financial year. However the World Bank has forecast growth to be just 7.2 per cent for the year.
TOKYO — South Asia must accelerate regional economic integration and improve connectivity to truly become a cradle of growth according to experts at a panel discussion on Tuesday during the International Conference on The Future of Asia.
Led by India’s solid performance — and supported by relatively young populations and low wages — South Asia’s growth is expected to hit 6.8% in 2017 up from 6.7% a year ago. In 2018 growth is expected to reach 7.1% according to the World Bank which has described the region as a “global growth hotspot.”
However Shahriar Alam Bangladesh’s state minister for foreign affairs said regional integration still lags behind neighboring Southeast Asia. Intra-regional trade in South Asia is only around 5% of the total trade much lower than the Association of Southeast Asian Nation’s 25%.
The minister called for stronger cooperation among the eight-nation South Asian Association for Regional Cooperation. The group comprised of India Pakistan Bangladesh Sri Lanka Nepal Bhutan Maldives and Afghanistan has a population exceeding 1.7 billion people.
Rajesh Chadha senior fellow at India’s National Council of Applied Economic Research echoed the minister’s concern. “South Asia is the least integrated [region] in the world” he said.
Chadha added that the South Asia Free Trade Agreement which came into force in 2006 lacks strength: “There is a lot to be done. Even if it is called an FTA not all the tariffs are free. There are non-tariff barriers.”
Citing Japan’s funding and support for an Indian railway project the economist called for support from the nine observers of SAARC such as Japan South Korea China U.S. and the European Union.
“The new Delhi Metro Rail is comparable to any rail in the world … and the metro has changed the life of India” he said. “[People] who would have spent half a day to go from one part of the city to another part are now traveling in two hours. So imagine the numbers of jobs it has created and skill match it has created in India.”
State minister Alam raised the importance of regional connectivity. “To reap the benefit of the fastest growing region and the demographic dividend with 75% of [Bangladesh’s] population below the age of 35 we really need to connect ourselves and … facilitate people to people connect” he said.
Nikkei staff writers Natsumi Kawasaki and Risa Tsurufuji contributed to this article
TOKYO — Asian countries should band together to counter intensifying anti-globalization head winds experts from Japan China India and Southeast Asian countries agreed at an international conference on Monday.
The panel members were asked to exchange opinions on “free trade and the rising tide of protectionism” at the International Conference on the Future of Asia in Tokyo organized by Nikkei Inc. On the emergence of protectionism Surin Pitsuwan former secretary-general of the Association of Southeast Asian Nations said he harbors “a sense of tremendous concern” for global development.
The negative impact he said could hit not only East and Southeast Asia but “really the global economy and the well-being of the global community as a whole.”
In the past those who resisted globalization tended to hail from the developing world Surin said. But that has changed: “We have learned to tame the force of globalization to [suit] our own interest. We have accommodated it and we have somehow made use of it in order to solve our own problems our poverty.”
Today he said the anti-globalization sentiment is setting in on “the other side of the equation from where globalization started.” To counter such trends in the U.S. and Europe “I think the countries of East Asia the countries of the Indo-Pacific region the countries of Southeast Asia will have to come together” to pool strengths and “integrate ourselves.”
He stressed the need for regional integration not only in the fields of trade and investment but also other areas such as energy and labor.
China for its part is pushing its Belt and Road Initiative which is aimed at creating an expansive economic zone. Through infrastructure improvements and other projects this program will help foster closer economic ties between countries and enhance growth said Li Xiangyang director of the National Institute of International Strategy at the Chinese Academy of Social Sciences.
The Belt and Road will contribute to filling “the gap left by the U.S.” Li said. At the same time he said China’s economy “has been integrated with the global value chain.”
The protectionism espoused by U.S. President Donald Trump the experts agreed is a concern for Asian nations collectively. “China and Asian countries share common interests in addressing protectionism” Li said.
There was also agreement that Asia’s deepening integration should work to counter the trend. Rajesh Chadha senior fellow at the National Council of Applied Economic Research in India stressed the need for Asian countries to promote cooperation to wield greater influence on the U.S. “The 21st century is our century” he said. “This is the century that belongs to Asia.”
