Full remonetisation in 2 months: CEA
January 31, 2017  14:34
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Chief Economic Advisor Arvind Subramanian addresses the media after tabling of the Economic Survey. The Economic Survey projects the official version of the state of the economy and is presented in Parliament a day before the presentation of the annual Budget. It acts as a precursor to the budget. It discusses the outlook, prospects and challenges of the economy while recommending reform measures that are essential to propel and thrive the economy.

Subramanian begins by thanking his "fantastic boss", the finance minister Arun Jaitley. Alludes to Amitabh Bachchan saying the budget should have drama. He says the past year has had robust macroeconomic stability but  full remonetisation is essential. Tax harassment and arbitrariness could hurt credibility. He said demonetisation is an unusual experiment and no models exist.

On demonetisation: "There were hardships, but it will have long term benefits. Demonetisation has actually affected different forms of money very differently. What demonetisation has done is both simultaneously reduced supply of cash, but by the same token it has increased supply of deposits. Economic & policy climate uncertainty in the short term. Macro economic stability absolutely fundamental to anything the government wants to do," says the CEA.

Halfway through his discourse on the Economic Survey, Arvind Subramanian asks his audience what were the interest levels. After getting "excellent" as a response, Subramanian says, "Good, I'm just getting warmed up."

He said it's not appropriate to do a before-after analysis of GDP growth, with respect to demonetisation. Full remonetisation, says the CEA, is essential and is expected in a month or so.

India's economic growth has been pegged at 6.5 per cent for the current fiscal, down from 7.6 per cent recorded in the last financial year, but is expected to rebound in the range of 6.75-7.5 per cent in 2017-18.

For all Arvind Subramanian fans: The CEA speaks to Dr Prannoy Roy on NDTV at 9 pm today.


Read the Economic Survey 2017 here
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