GROWTH IS­SUES: AS THE CEA SEES IT

The Economic Times - - Companies: Pursuit Of Profit -

SHORT-TERM DE­MON­ETI­SA­TION SHOCK GROWTH NOT COM­PA­RA­BLE WITH LAST YR

due to less money & im­pact on pri­vate wealth

to the ex­tent eco­nomic ac­tiv­ity de­pen­dent on cash causes peo­ple to de­fer dis­cre­tion

and will con­trib­ute to higher growth Lin­ger­ing ef­fects

prices due to geopo­lit­i­cal rea­sons

that have im­pacted growth are de­mon­eti­sa­tion & higher oil prices

ES­TI­MATES NOT COM­PA­RA­BLE WITH THOSE OF OTH­ERS

base­line fore­cast be­fore de­mon­eti­sa­tion was much higher than CSO’s ad­vance es­ti­mate

among ma­jor economies should be change in fore­cast of de­mon­eti­sa­tion

POL­ICY STANCE

can be sup­port­ive but pru­dence and cred­i­bil­ity has to be con­sid­ered with­out these, growth would be closer to CEA es­ti­mate

FY18: IN­VEST­MENTS UN­LIKELY TO RE­COVER SIG­NIF­I­CANTLY

from re­mon­eti­sa­tion and lower in­terst rates, oil prices a drag in­vest­ments could off­set weaker pvt in­vest­ment GST, fol­low up mea­sures to de­mon­eti­sa­tion & struc­tural re­forms needed to achieve this can be lower in keep­ing with lower mar­ket rates due to de­mon­eti­sa­tion

pub­lic sec­tor as­set re­con­struc­tion com­pany from wind­fall gains

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