Deregulation set to become India's next area of focus for growth: CEA Nageswaran

Chief Economic Advisor V Anantha Nageswaran.

Chief economic advisor V Anantha Nageswaran on September 22 said the next area of focus will be deregulation for India, with panels se to soon submit reports on the action plan.

“We are focusing on deregulation. Next important policy agenda is deregulation committees to submit reports and act on them,” Nageswaran said at Network18 Reforms Reloaded, a platform discussing India’s next phase of growth.

Nageswaran, meanwhile, said the impact of US tariffs may be muted in the current year and is likely to be compensated by the goods and services (GST) rate cuts taking effect from September 22.

“0.4-0.5 percent reduction was expected from India's trend growth of 6.5 percent in this year, and 1 percent reduction was likely next year due to tariffs. But now due to GST the impact may be lower,” he said.

Nageswaran said the government is expecting ramp up in private sector spending data with fiscal prudence and stability, ease of doing business as building blocks. Need to open up geographies for exporters, the CEA said.

Moreover, the top economic adviser said foreign direct investment is unlikely to be impacted in medium to long term. “GST, deregulation may act as catalyst for higher FDI,” he said.

“Even with additional tariffs, medium to long term investment attractiveness of India will not be impacted,” he added.

He also said there are certain sectors where India needs to make sure that supplies of capital goods is there to become self reliant in manufacturing. "It's not anti-foreign investment position," he said.

In addition, Nageswaran pitched for opening of the education sector to boost competition.