Hyderabad, Dec 15: NITI Aayog member VK Saraswat today said the implementation of Sixth Pay Commission has also contributed to the surge in urban purchasing power leading to buying of more number of vehicles in cities and resulting in congestion of roads.
Delivering a keynote address at Administrative Staff College of India here, the former DRDO chief also said MSME sector needs more innovation push as it contributes to nearly 45 per cent of the total employment in the country.
"The biggest problem in our country today is because of the increase of purchasing power in the cities. There is an absolute consumption taking place in cities," Saraswat said in his lecture titled 'Innovation and Sustainable Economic Growth'.
"And this consumption is much worse after the Sixth Pay Commission. That's why you saw large number of cars coming on city (roads)," he said. The Sixth Pay Commission was implemented with effect from January 1, 2006.
He opined that cities like Delhi face congestion problems due to the increase in automobiles. "Why there is a problem in Delhi because there used to be a few cars once up on a time before the Sixth Pay Commission. But it all (happened) after Sixth Pay Commission (as) those who don't need cars also have cars.
And as result you have congestion," Saraswat said. On innovation, he said MSME sector was neglected in terms of encouraging innovation despite the fact that it is the largest contributor in terms providing employment opportunities.
"MSMEs are the largest contributor for the economy. So we have to breed the innovation in MSMEs because nearly 45 per cent of the jobs are created by them. "It (MSME) is huge segment. But unfortunately we are neglecting that and going more and more on the corporate and big industries," he added. He further said some of the programmes by the Centre such as 'Make in India','Digital India' would provide a huge scope for innovation.