Bhubaneswar: Chairman of the Economic Advisory Council to the Prime Minister, Dr Bibek Debroy on Wednesday said India needs to bring reforms in land, labour and capital markets in order to achieve more competitiveness and ensure economic growth
Debroy was speaking at a special lecture organised in Bhubaneswar by the Odisha Economic Association in collaboration with the Analytical and Applied Economics Department, Utkal University. He was delivering a lecture on “The Indian Economy: The Path to 2047”.
Utkal University Vice-Chancellor Prof Sabita Acharya was the guest of honour. Former Odisha Chief Secretary Jugal Kishore Mohapatra, who is the president of OEA, presided over the meeting.
Debroy said COVID-19 has changed the equation of the world and India successfully managed the COVID-19 pandemic, produced and exported vaccines to the entire world. In 1991 when India introduced the economic reform the per capita income used to be 310 USD only. At present the per capita of India is 2500 USD.
In spite of that India is relatively a low income country. The richest countries have around 1,75,000 USD per capita income, he said, adding that India may achieve 6.5% to 7.5% growth rate in the Amrit Kaal. With the average 6.5 % annual growth rate by 2047 India’s GDP shall reach at 20 trillion USD with a per capita income of around 10, 000 USD. With this India will become a high income country. With 7.5% annual average growth rate India’s GDP may reach at 30 trillion USD by 2047. With this India will become a developed economy, said Debroy.
In order to achieve these targets, the country should spend around 10% of GDP on infrastructure, 4% of GDP on health, 6% on education and 3% on other sectors. For achieving 23% of GDP expenditure we need to increase the Tax-GDP ratio substantially and reduce the tax evasion and avoidance. “We need to focus not only on the devolution of funds from Union to states but also from states to local governments. We need to bring reforms in land, labour and capital markets to achieve more competitiveness. Although there is somewhat reform in capital market states need to work a lot on land and labour market reforms. We need to introduce Bhu-AAdhar,” he said.
“We need to increase the formalisation of MSMEs. The efficiency of legal system needs to be improved significantly. Increasing inequality remains a matter of serious concern and controversial issue for all. The best way to achieve inclusive growth is to make provision of the basic necessities for all,” Debroy added.
Vice Chancellor of Utkal University, Prof Sabita Acharya said that growth should not be the only objective. Prof Mitali Chinara, Head of the Department, A&A Economics, Utkal University welcomed the guests. Dr. Amarendra Das, Secretary of OEA offered vote of thanks.
