Abatement of pandemic to kick in virtuous investment cycle, generate jobs: CEA

Pinning hopes on rapid vaccination drive newly appointed Chief Economic Advisor CEA V Anantha Nageswaran said that abatement of the Covid19 pandemic would kick in virtuous cycle investment leading to job creationThe government has taken various steps to support lower income categories he said in an interaction with the media on the Survey tabled in Parliament by Finance Minister Nirmala Sitharaman earlier in the dayNaturally he said it will take time to regain confidence because the slowdown in consumption spending is not only a function of the lack of income growth but also because of the uncertainty caused by the pandemic and health impact etc So once the pandemic cloud itself is lifted and many of the contact services come back into their prepandemic levelwe hope that along with the various measures that the government has taken and private sector capex also kicking in we will go into a virtuous circle of income generation and employment generation he saidHe said the construction sector is beginning to revive and thats one of the highest employers in the country Nageswaran expressed hope the consumption share of GDP which is about 97 per cent compared to the prepandemic level especially in the second half of the new financial year should come back into stream assuming that the subsequent impacts of pandemic turns out to be milder and milder The government has pursued the fourpronged approach the short term support to the economy especially to the vulnerable section during these uncertain times while keeping a firm eye on the fiscal stability At the same time never to let go the opportunity that a crisis provides to initiate structural and supplyside reforms The government has undertaken several measures as well he saidTheres been considerable attention and emphasis on process reforms as well he said adding so these are the four pillars of the governments approach in dealing with the pandemic and also to prepare the economy for a post pandemic world Asked about inflation Principal Economic Adviser Sanjeev Sanyal said CPI has been in the tolerance zone Overall Sanyal said macroeconomic stability indicators suggest that the Indian economy is well placed to take on the challenges of 202223 Last two years have been particularly challenging for policymaking around the world with repeated waves from a mutating virus travel restrictions supplychain disruptions and more recently global inflationFaced with all this uncertainty the Government of India opted for a Barbell Strategy that combined a bouquet of safetynets to cushion the impact on vulnerable sections of societybusiness with a flexible policy response based on a Bayesian updating of information he said As explained in last years Economic Survey he said this is a common strategy used in financial markets to deal with extreme uncertainty by combining two seemingly disparate legsAs some readers will have guessed the iterative leg of this strategy is the same as the Agile approach that uses feedbackloops and realtime adjustment he said adding the Agile approach is a wellestablished intellectual framework that is increasingly used in fields like project management and technology development In an uncertain environment the Agile framework responds by assessing outcomes in short iterations and constantly adjusting incrementally he saidIt is important here to distinguish Agile from the Waterfall framework which has been the conventional method for framing policy in India and most of the world The Waterfall approach entails a detailed initial assessment of the problem followed by a rigid upfront plan for implementation This methodology works on the premise that all requirements can be understood at the beginning and therefore precommits to a certain path of action he said This is the thinking reflected in fiveyear economic plans and rigid urban masterplans he addedThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever