Government Will Follow An Expansionary Fiscal Policy

India's GDP growth rate has slowed to 5.8 per cent in the March 2019 quarter, taking the overall growth for 2018/19 to 6.8 per cent. What are the immediate steps needed to steer the economy back to higher growth?

Our macroeconomic parameters like inflation and current account deficit are on sound foundation. This gives space to the RBI (Reserve Bank of India) to cut interest rates. If it (rate cut) is properly transmitted, consumption and investment demand will pick up. This is going to be effective in the short term. There are some areas of concern in the medium term. Manufacturing has to be developed, particularly the MSME (micro, small and medium enterprises) sector. Its potential for employment generation (another area of concern) is huge. All bottlenecks preventing capacity expansion need to be removed. Along with strengthening manufacturing and employment generation, the government will also focus on increasing the agriculture sector income and doubling it