New Delhi: President Pranab Mukherjee on Wednesday said demonetisation may have led to "temporary" slowdown in economy but it will bring more transparency in the system.


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"Demonetisation, while immobilising black money and fighting corruption, may have led to temporary slowdown of economic activity. As more and more transactions become cashless, it will improve the transparency of the economy," Mukherjee said in his Republic Day eve address to the Nation.


The President said domestic industry must improve its competitiveness by focusing on quality, productivity and efficiency. He also said a 10-percent sustained growth was imperative to wipe out poverty.


"In the first half of 2016-17, it grew at a rate of 7.2 percent - same as that last year - showing sustained recovery. We are firmly on the path of fiscal consolidation and our inflation level is within comfort zone," he said.


"We have to work harder to provide enhanced employment opportunities to our youth through the creation of world-class manufacturing and services sectors. The competitiveness of the domestic industry has to be improved by focusing on quality, productivity and efficiency," Mukherjee said.


The president said the various initiatives of the government had been promoting the well-being of the people. Among them, he specifically listed Aadhaar, which was plugging leakages in reaching government schemes to 110 crore people in a transparent manner.


He said the Digital India programme was creating a knowledge economy and a digital infrastructure to promote cashless transactions, while Start-up India and the Innovation Mission were fostering new-age entrepreneurship.


The Skill India initiative targets 300 million youth by 2022.


The President said as the nation enters its 68th year as a republic, one has to work harder since the war on poverty is not yet over. "Our economy is yet to grow at over 10 percent for an extended period of time to make a significant dent on poverty," he said.


The president lamented that one-fifth of India`s still remained below poverty line.


"We have to work harder to provide food security to our people and to make the agriculture sector resilient to the vagaries of nature. We have to provide better amenities and opportunities to our people in villages to ensure a decent quality of life."


With Agency Inputs