India Inc today disagreed with the suggestion of the Prime Minister's Economic Advisory Council (PMEAC) on withdrawal of stimulus measures, stating the global economy is yet to recover from the impact of the downturn.
"With the global economy yet to recover, which poses significant down side risks to growth, there is a need to continue with the stimulus measures for some more time," CII said while reacting to the PMEAC suggestion.
The PMEAC, in its economic outlook released today, suggested that the government initiate fiscal consolidation measures in the forthcoming budget as the current level of fiscal and revenue deficits are unsustainable.
The PHDCCI also said the rollback of stimulus measures would affect the growth of the industry.
"It is important to retain the stimulus package in the forthcoming Budget as the withdrawal would reverse the gains so far accrued to our industry and impede the growth momentum," the chamber said.
It also said the government should step up public investment in rural infrastructure, improve agriculture research and make the supply chain from farm to markets more effective to control food inflation. It also said multi-pronged strategy should be adopted to keep inflation within manageable limits.
The CII also asked the government to release excess buffer stock of food grain to stem food inflation that has touched 17.97 per cent.