Govt. has two years to 're-energise' economy: Deutsche Bank report
New Delhi [India], Apr 28 : According to a report published by the Deutsche Bank, the government has two more years to're-energise' the economy, re-start the investment cycle and accelerate job growth.
May 25, 2017 marks the completion of three years of governance under Prime Minister Narendra Modi, but despite several new policies, investment growth in the country continues to be stagnant, leaving a similar impact on economic growth and job creation in the country.
"With urban employment growth stalling over the past few quarters due to slowing investments in e-commerce/internet startups and Indian IT services demand, job creation is likely to take on critical status on the government's economic agenda as the government enters the last two years of its term," says the report.
An analysis of data from the previous regimes revealed that since 1991, last two years recorded a hike in expenditure.
"Rise in the capital expenditure has been accompanied by rise in production of capital goods for previous governments, with exception of UPA-II," the report stated.
With regards to inflation, the report attributed the pattern of increased CPI-WPI differential to favourable consumption back drop and can also be extrapolated to supportive margins for downstream companies.
While consumer discretionary and cyclical sectors outperformed in the last two years, telecom and exports saw a significant decline in output.
According to the Deutsche Bank, "relative performance dynamics can be directly linked to Government's pro-growth intent and actions."
Therefore, while preparing manifestos ahead of the 2019 General Elections, it is detrimental for the private investment cycle to gain momentum in order to enhance economic growth and employment. (ANI)