Acknowledging that a slowing economy and need for jobs are pressing issues that need sustained follow-up, the new government under Prime Minister Narendra Modi decided to set up two new committees of the Cabinet — one on Investment and Growth, and the other on Employment and Skill Development.
Falling economic growth rate
For the government, a slowing economy has been a major concern, especially during the last financial year when GDP growth rate dropped below the original estimate of 7 per cent to 6.8 per cent. Growth rates were sequentially lower every quarter, with the last quarter (January-March 2019) growing just 5.8 per cent, the lowest in 20 quarters.
Private investment has remained depressed for the past many years due to poor credit generation on account of huge bad loans. Moreover, the consumption expenditure is also slowing down.
Composition of Cabinet Committee on Growth and Investment
The Cabinet Committee on Growth and Investment will have five members and likely include Amit Shah (Home), Nitin Gadkari (Road, Transport & Highways and MSMEs), Nirmala Sitharaman (Finance and Corporate Affairs) and Piyush Goyal (Railways and Commerce and Industry), sources said. These ministries are key to attracting large private investments in infrastructure sectors and green field projects, facilitating ease of doing business, and clearing foreign investment proposals.
Cabinet Committee on Employment and Skill Development
The slowing growth has had its impact on jobs too. The unemployment rate for 2017-18, according to the Periodic Labour Force Study, stood at 6.1 per cent, the highest in the last four decades. The Cabinet Committee on Employment and Skill Development attempts to address the skilling and jobs problem holistically.
It will be composed of ministries such as HRD, Labour and Employment, and Skill and Entrepreneurship. It will allow for an integrated approach while addressing issues related to skilling at school level, ITIs and the certification process in government and private skilling institutes. Two, to ensure that skills being imparted are in tune with the job requirement and sectoral demand, the Cabinet Committee on Employment and Skill Development also proposes to include ministers representing various sectors such as agriculture, infrastructure, construction and manufacturing.