PM To Meet State Chief Secretaries To Discuss Growth Strategy

(MENAFN- Live Mint) New Delhi: Prime Minister Narendra Modi will meet state chief secretaries next month ahead of the annual conclave with chief ministers to finalize the near-term policy agenda, two persons aware of the development said.

The December meeting has been called by federal policy think tank NITI Aayog.

The three-day meeting starting 13 December will help in identifying key issues for the Prime Minister to take up with chief ministers at the next governing council meeting of NITI Aayog, said one of the persons quoted above.

The NITI Aayog governing council meeting is expected to hear from states about their expectations of the next Union budget. Parallelly, finance minister Nirmala Sitharaman will be meeting her state counterparts on 20 December for budget consultations in Jaisalmer.

While states are keen to bring up resource allocation and fiscal support for schemes in Centre-state discussions, the union government is keen that states bring reforms that will help them attract more investments and spur development.

At the last NITI Aayog governing council meeting held in the capital in July, Modi and chief ministers discussed a vision paper on making India a $30 trillion developed economy by 2030.

Modi then urged state chief ministers to come up with vision documents for the development of their respective states, have tangible goals and to pursue them as a developed nation is essentially an aggregation of developed states, Mint reported on 27 July.

The second person quoted above said NITI Aayog is working on an investment index of states showing which policies or measures are helping attract investments and which are hindering them.

One important issue that is likely to come up in Centre-state deliberations is transfer of resources to states, said N.R. Bhanumurthy, director, Madras School of Economics.

“There could be discussions on the strategy for balanced regional growth and development. Some states are doing well but some others are lagging behind, though not because of lack of finance. The other issue that could figure in Centre-state discussions is the right use of resources, given the competitive populism seen in Indian political landscape,” said Bhanumurthy.

Rumki Majumdar, economist, Deloitte India said cushioning the domestic economy from geopolitical uncertainty, using technology to meet societal goals and enhancing the human capital are key areas that deserve attention from policy makers.

Bhanumurthy welcomed the attention that districts are getting for their role in the country's growth.

“The strategy for sustainable growth and governance should be localized given that allocation of resources alone is not sufficient. Localization of strategy and improvement in efficiency will lead to better growth and development outcomes,” he said.

Majumdar of Deloitte said that some of the major economies have had their elections and with the change of guard in the US, there could be quite a few significant policy changes in the years ahead, impacting global growth, trade, and investment.

Also, the geopolitical uncertainties around the war in Ukraine and in West Asia have had an impact on supply chains.

“It is clear that measures will be needed to cushion the economy. That is why policymakers are looking at how well domestic demand could be spurred so that our dependence on external economy becomes limited, or at least we can cap the impact of such uncertainties. In this context, spurring consumer demand and increasing private investments will matter a lot,” said Majumdar.

“We believe that India in the next budget will probably be looking at how to boost domestic demand through a much broad-based consumer spending, which means policy makers have to look at measures that boost rural and urban demand and also capex spending to crowd in private investments,” said Majumdar.

The second uncertainty is the way changing technology is impacting job creation, she said.

“While technology has the advantage of improving productivity and efficiency, it also brings the challenge of making certain jobs redundant. It is crucial to explore ways to harness technology effectively to create better livelihood opportunities and drive growth in priority sectors such as agriculture, health, and education. The potential of AI to contribute to overall societal development deserves focused attention,” she said.

Queries emailed on Monday to the Prime Minister's Office and to NITI Aayog Vice Chairperson Suman Bery seeking comments for the story remained unanswered at the time of publishing.

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