EAC-PM suggests incentives for achiever states

As economic growth takes time to recover, affecting the lower strata of society in particular, the Economic Advisory Council to the Prime Minister (EAC-PM), headed by Bibek Debroy, has favoured incentivising states for achieving results in sectors like health and education.

According to an official statement, the EAC-PM, in its second meeting held on Friday, also underlined the need for giving high priority to infrastructure financing, with new mechanisms for a risk coverage umbrella.

The Council took stock of the prevailing economic situation and spelt out “a clear road map” for stepping up skill development, job creation, and resource investment in the social sector, including health and education, and boosting infrastructure financing.

“It formulated far-reaching recommendations to guide the evolving framework for the Fifteenth Finance Commission, including the incentivisation of states for achieving health, education, and social inclusion outcomes,” the statement said.

The Council is also evolving the design of a new ‘Economy Tracking Monitor’, linking economic growth indicators with social metrics for last-mile connectivity.

Presentations by experts were made to the Council on key themes, including infrastructure financing by Debroy. “The unique feature of the new Economic Advisory Council to the Prime Minister is turning out to be its ability to link economic growth with social aspects, with greater last-mile connectivity,” the release said.

Its “value addition as an independent institutional mechanism” for providing informed advice to the Prime Minister is increasingly being recognised, it added.

The EAC-PM also discussed issues related to improvements needed in the national accounts and innovative steps for unlocking the growth, exports and employment potential of growth drivers, including through transformation of India’s gold market.