Administrative, legal reforms to be on govt agenda: Sanyal

KOLKATA: Member of Economic Advisory Councilto the Prime Minister Sanjeev Sanyal on Tuesday said the next reforms agenda of the government would be on administrative and judicial sectors of the country.

Speaking at the Bharat Chamber of Commerce (BCC) here, Sanyal said after 2014 when the present government took over at the Centre, reforms were undertaken for innovation-based economy. “Since 2014, new cycle of reforms had been put in place. In the last decade, reforms were done for an innovation-based economy. Insolvency and Bankruptcy Code (IBC) and GST were introduced, and inflation targeting started”, Sanyal said. Now two major reforms, administrative and judicial, are needed for which wide public support is required.

“Whenever we do it, there will be resistance. The administrative system was created by the British with the sole aim to control. This is similar with the judiciary. The system does not want to deliver justice, but to control”, he said. These are the two major areas of reforms which the government will start focusing on, he said. On the macroeconomic side, Sanyal said this year the growth of the economy will be between 6.5 per cent to seven per cent this fiscal. “There is macroeconomic stability in the country at present. Current account deficit (CAD) is within a reasonable range and foreign exchange reserves are at $600 billion”, he said. Sanyal said, “But with weak export demand, there is no need to push domestic demand through stimulus as this might put stress on the external sector causing problems in the CAD”.

According to him, the focus would have to be on keeping the supply side strong as it had been during the COVID years.

“Past investments in infrastructure are benefitting us now. Growth of 6.5 per cent given the world depressing scenario is not bad”, Sanyal said. He said “There is no need to press the growth accelerator at this moment. We can do that when there is a clear highway. Still, some bumps are there.” It is not wise to sacrifice macroeconomic stability for a few higher points of growth, he said, adding that the need is to keep the banking system robust and strong supply side, he noted. “We will surely go past Germany and Japan in terms of the size of the economy. But the next two economies will be far away from us after we become the third largest”, he said.