Govt policies directed at fostering competition in economy: CEA

The focus of the government policies in the last seven years has been on enabling competition in the economy, CEA K V Subramanian said, stressing this is partly responsible for growth of startups

The focus of the government policies in the last seven years has been on enabling competition in the economy, Chief Economic Adviser K V Subramanian said, stressing this is partly responsible for growth of startups.

He expressed hope that the country will witness double-digit growth in the current fiscal year aided by a prudent mix of supply and demand side measures undertaken by the government.

"With all these reforms, India is poised for high growth and inclusive growth through job creation especially in the organised sector going forward, our projection is that this year there is a high likelihood we could have double-digit growth. Next year we anticipate between 6.5-7 per cent," he said at a virtual event organised by Indian Private Equity and Venture Capital Association (IVCA).

As the impact of reforms starts taking in, the potential growth would accelerate beyond 7 per cent, he said, adding, "given the seeds that we have sown, (they) should fructify in this decade. It should be a decade of inclusive growth for India."

He further said the main idea behind all the policy measures--labour market reforms, farm sector reforms, the enterprise policy focus on the private sector and the policy of asset monetization-- is to enable competition, especially, in factor markets.

"If you recall in 2014, the startup economy was gasping for breath, because of the crony lending that would actually be antithetical to competition in the economy...fair competition is actually something that is really important...that is why we are seeing these 100 plus unicorns that has been created," he said.

The number of new firms created in the manufacturing sector over the last five years has nearly tripled to 41,000 from 15,000 annually in 2017, he said citing data.