Some of them also recommended measures to boost farm sector growth, curb inflationary pressure and promote innovative climate mitigation measures, they said.
The manufacturing policy should include a strategy on import tariffs, taxation, technology transfer and other related aspects to cover the entire spectrum of potential policy interventions, they are learnt to have told the minister.
The share of manufacturing has remained almost stagnant at 15-17% of gross domestic product (GDP) for decades now and attempts by successive governments to raise it to 25% of GDP haven’t quite yielded results.
Investment incentives
While private investments have gained traction in many sectors, the government needs to incentivise companies to ensure broad-based and sustained growth in their capital spending, the economists recommended.
They acknowledged the central government’s efforts to crowd in private investments through sustained hikes in its own capital spending and expected it to keep up the public capex momentum in 2025-26 as well.
The government has sharply raised its capex outlay in the range of 17% to 39% annually since FY22, as it sought to use the high multiplier effect of such expenditure to nurse a Covid-hit economy back to health amid flagging private investments.
Inflation and climate mitigation management
The economists are learnt to have pushed for steps to boost farm production and growth to sustainably keep under control food inflation, which has been the prime driver of headline retail inflation in recent months.
Moreover, the government needs to take further measures to boost storage facilities for farm produce, they said.
While India’s efforts to bolster its renewable energy production are commendable, further sources of green energy may be tapped, some of them are learnt to have said.
Sitharaman held her first pre-budget meeting this year with economists, which will be followed by similar huddles with other stakeholders, including representatives of the farmer associations, MSMEs, trade unions, the financial sector, the capital market, the infrastructure and the social sectors, until December 30.
About a dozen economists took part in the consultation meeting, including Suresh Babu (Madras Institute of Development Studies); C Veeramani (Centre for Development Studies); Samiran Chakraborty (Citigroup); Ashwani Mahajan (Swadeshi Jagran Manch) and Nikhil Gupta (Motilal Oswal).