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Recalibrate export strategy with manufacturing focus: Parl Panel
'India's economic roadmap must aim not only for a short-term $5 trillion economy but also for sustained, inclusive, and resilient long-term growth,' the committee, chaired by Member of Parliament Bhartruhari Mahtab, said.
The finance ministry informed the panel that, given geopolitical uncertainties and the evolving global trade landscape, the government's growth strategy is rooted in policies that promote resilient, inclusive, and sustainable domestic growth while staying responsive to emerging global and domestic challenges.
The report, titled 'Roadmap for Indian economic growth in light of global economic and geopolitical circumstances,' noted that India is well-placed to navigate current global disruptions and advance toward becoming a high-income economy faster than many of its regional counterparts. The parliamentary panel emphasised the need for effective reforms and deregulation to become a high-income economy.
The panel also stressed the pivotal role of Artificial Intelligence (AI) and data for effective governance, suggesting the establishment of an indigenous, government-owned AI server to address privacy concerns, improve efficiency, and harness data for informed policy-making. It expressed concern about "digital deserts" in rural and underserved areas and recommended scaling up digital infrastructure in remote locations.
The committee highlighted that the investment rate in the economy must rise to around 35 per cent of GDP from the current 31 per cent to meet the ambitious growth target of 8 per cent annually for at least a decade.
While acknowledging the importance of sustained capital expenditure for accelerating long-term productivity and job creation, the panel stressed the need to improve public investment efficiency to enhance output per unit of capital.
On the issue of fiscal discipline at the sub-national level, the committee recommended tailored fiscal reforms in highly indebted states to improve their fiscal health while maintaining their capacity to invest in critical infrastructure and social development.
The parliamentary panel also advised market regulators to be cautious about the influence of foreign investors and their potential impact on market volatility.
'To mitigate these risks, the Committee recommended prioritising domestic economic resilience through fiscal consolidation and encouraging SEBI and the RBI to continue streamlining regulations and improving market infrastructure,' the panel said, also suggesting diversification of India's investor base and promoting strategic sectors to attract committed FDI.
The Committee suggested regular monitoring and evaluation of poverty reduction programmes to ensure responsiveness to emerging challenges and demographic shifts.
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