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India to return to 8% plus growth trajectory in another 2-3 years: Niti Aayog

28 Apr 2017 Evaluate

Suggesting a host of reforms to accelerate economic growth, the government think-tank Niti Aayog (the National Institution for Transforming India) in its ‘Three Year Action Agenda (2017-18 to 2019-20)’, exuded confidence that India will get back to over 8 per cent growth in another 2-3 years. It noted that a quick corrective action in 2014, followed by sustained policy reforms have helped the economy to sustain 7 percent plus growth during the 3 years ending on 31 March 2017.

Niti’s proposed action agenda stressed on reforms in taxation, agriculture and governance, among others with a view to accelerate the all- round development of the country. One related proposal is consolidating existing custom duty rates to a unified rate. In the area of urban development, the draft stresses on the need to bring down land prices to make hosing affordable through increased supply of urban land. It proposed more flexible conversion rules from one use to another, release of land held by sick units, more generous floor space index, reform in the Rent Control Act and promoting dormitory housing. the Niti Aayog has proposed for reduction in corporate tax to 25 percent (including surcharges and cesses) from 34 percent and uniform import duty at 7 percent to do away with the problem of inverted duty structure. It has also emphasised on strengthening the civil services through better human resource management, e-governance, addressing anomalies in tenures of secretaries and increasing specialisation and lateral entry.

It has suggested shifting the composition of expenditures by allocating a larger proportion of additional revenues that become available over time to high-priority sectors. In its proposed action agenda the share of non-developmental revenue expenditure in total revenue expenditure would decline from 47 percent in 2015-16 to 41 percent in 2019-20, while the share of capital expenditure, which is more likely to promote development, would rise significantly, implying substantial expansion in expenditures by 2019-20 on education, health, agriculture, rural development, defence, railways, roads and other categories of capital expenditure. 

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