En­er­gised Bu­reau­cracy Ready with Ac­tion Plan for Modi

The Economic Times - - Economy - DEEPSHIKHA SIKHARWAR

Cen­tral min­istries deal­ing with eco­nomic af­fairs are ready with ac­tion plans that will help the Naren­dra Modi Cab­i­net usher in a new wave of eco­nomic re­forms in the coun­try, top bu­reau­crats said.

“We have Cab­i­net notes ready that could be moved quickly,” a se­nior of­fi­cial at an in­fra­struc­ture min­istry told ET, adding that other min­istries have also drawn up their plans.

Most min­istries have drawn up flex­i­ble plans that en­vis­age al­ter­na­tive op­tions, so that they can be tweaked quickly to ac­com­mo­date the new govern­ment’s think­ing. The pro­pos­als range from smoothen­ing fi­nanc­ing of growth by pro­vid­ing additional cap­i­tal rais­ing av­enues to pub­lic sec­tor banks, an ef­fec­tive plan to tackle food in­fla­tion, a blue­print to spur man­u­fac­tur­ing, cre­at­ing new modes of in­fra­struc­ture, re­jig of in­di­rect tax struc­ture and re­form of sub­si­dies. Much of this ini­tia­tive has come from an en­er­gised bu­reau­cracy, which is con­fi­dent that the new govern­ment would em­power them to take de­ci­sions. “We have a blue­print ready on key re­form mea­sures that need to be taken im­me­di­ately…. In­fla­tion is one of the key con­cerns and in case of fail­ure of mon­soon, an ur­gent con­tin- gency plan is re­quired,” said a se­nior of­fi­cial at an eco­nomic min­istry. Fis­cal con­sol­i­da­tion is ex­pected to re­main high on the agenda, al­though there is ex­pec­ta­tion that key sub­sidy re­forms such as in fer­tiliser will also be in fo­cus. “The em­pha­sis on fis­cal con­sol­i­da­tion is un­likely to change….Im­ple­men­ta­tion could wit­ness some changes,” said a govern­ment of­fi­cial, adding that sub­si­dies could get at­ten­tion. Of­fi­cials in the fi­nance min­istry have al­ready done the ground­work on the goods and ser­vices tax (GST), so that it could be rolled out quickly if the govern­ment is able to get states on board.

Ex­perts are al­ready en­thused by the new en­ergy in the govern­ment. “The de­ci­sive man­date in favour of the BJP will, af­ter many years, give us a govern­ment which would not be buf­feted by the pulls and pushes of a coali­tion,” said Ke­tan Dalal, joint tax leader at PwC In­dia. “Of course, it will take time for changes to trans­late on the ground, but one is hope­ful that there will be low hang­ing fruits, which the govern­ment is likely to deal with quickly, so as to send the right sig­nals.”

Hemant Kano­ria, man­ag­ing di­rec­tor and chair­man at SREI In­fra­struc­ture Fi­nance, said the re­cent trend of con­trac­tion in the man­u­fac­tur­ing sec­tor and slow­down in the ser­vices sec­tor indi- cates a grad­ual slow­ing down of do­mes­tic de­mand. “When sup­ply­side prob­lems get fur­ther ag­gra­vated by de­mand-side is­sues, it is a gen­uine cause for worry. This needs to be re­versed, and very quickly,” he said. The ship­ping min­istry has Cab­i­net notes ready for a coastal ship­ping pol­icy aimed at cheaper and faster move­ment of do­mes­tic cargo among nine coastal states, as also a plan to boost in­land wa­ter­ways. The depart­ment of in­dus­trial pol­icy and pro­mo­tion has pre­pared a roadmap for FDI re­forms and mea­sures to spur man­u­fac­tur­ing. It will also have a note ready for FDI in ecom­merce if the BJP shows any keen­ness on it.

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