Higher public spending required to lift economy’s mood: Chawla

Mumbai, Dec 21 (IANS) Former Finance Secretary and National Stock Exchange’s Chairman Ashok Chawla on Tuesday said higher public spending is important at this point to lift the mood of the economy.

"The most important thing that needs to be done by the government in terms of public policy at this point of time, particularly before the budget or at the time of budget, is to lift the mood of the economy… I presume the best impetus would be in the form of public spending. And for that, the government has to find out resources," he said.

He said higher public spending can revive the economy and boost consumption.

Commenting on the approach taken by the then UPA government, the former Finance Secretary said that in order to avoid the downward economic spiralling, what was done was public spending.

He suggested that the government could look at increasing exemptions on tax slabs because that will increase the disposable income of the people leading to higher consumption.

He also said that tax rate at the lower end of the pyramid might be tweaked.

"Giving concessions and relief is easy but withdrawing or reducing those at the appropriate time was difficult for the government," he said in an interview with BTVi.

Commenting on the rolling-out of Goods and Services tax (GST) when the economy took a shock of demonetisation, he said: "GST has been on the pipeline. It is appropriate to take the necessary approvals which require. Once these are in position, one should bite the bullet. There is never a wrong time for a good thing."

Elaborating on the plans of National Stock Exchange, he said there is no plan to list NSE overseas at the moment. "The board has decided that we first go ahead with domestic listings and then if necessary, we look at foreign listings as a second stage," he said.

"We are in the process of filing the draft prospectus in the next few days. Thereafter, it depends on approval of SEBI and also depends on our preparedness in terms of having new Chief Executive position. I would think in the second quarter of the calendar 2017, that is, somewhere between April to June in 2017, is where we actually see listing," he added.