Skip to main content

IMF's GDP Projections

By
The International Monetary Fund (IMF) on Wednesday lowered its growth forecast for the Indian economy in 2020 by 4.5 per cent, a "historic low", citing economic slowdown due to the two-month-long COVID-19-induced lockdown.



The fund, however, also said that India is expected to bounce back in 2021 with a 6 per cent growth rate. In 2019, India's growth rate was 4.2 per cent. 

The CoVID'19 lead economic crisis is different from other economic crisis in history and needs a different strategy. To revive the economy and boost growth govt should attract global investments and also increase liquidity and monetize the poor so much. Govt is highly ensuring the supply side hitch through credit guarantee schemes but only if the consumer has money in their hands these businesses would perform. 

Govt should not worry about the fiscal deficit and inflation for about 6 months. Only through more public spending, money would reach the poor - Garib Kalyan Rojgar is a good example. And regarding inflation, even if govt through MPC, controls the interest rates and inflation it will not stop hiking inflation due to demand for essential and food products. We could see a hike in WPI in May due to food prices. Also, it adversely affects growth. 

Adding to it govt increased the excise duty for fuels that also increases the food prices. Govt should ensure balance among inflation control, growth and food prices.

FM says the economy is recovering as the agriculture sector is contributing much. The fertilizer sales, wheat procurement by govt are contributing to the recovery and gives hope for growth in April - June quarter. But Agri sector contributes only 16% of the GDP, so it will not give high growth numbers for the quarter. Encouraging free market for the Agri products also seems good in terms of that the farmers have the choice to sell their goods but considering fuel prices and challenges in logistics, I believe they will end up selling it in the nearest mandi itself. I'm highly worried that farmers should not go to a situation of depending on MSP. 

High-level decision making are not always successful during implementation. There are a million examples from Mudra scheme to CGS. Please do research, make decisions based on statistical data and regarding structural reforms please consider parliamentary scrutiny and discussions instead of arbitrary actions.

Like our Facebook page:


Reference:
Labels:

Comments

Post a Comment

Popular Posts

Retail Inflation heats up

By
We have come across many articles about the revival of the Indian economy for the past 2 months but the govt. hasn’t listened to such things and they don’t want to do that as always. During the last Monetary Policy Committee meeting, RBI has decided not to reduce the repo rate in order to control Inflation. We know that Inflation with increasing growth rate is good for the economy but without growth isn’t. If the repo rate was reduced we would’ve got inflation with some increased growth rate. But now the growth rate hasn't hiked considerably but the retail inflation hits 4 years high says Consumer Price Index (NSO). The retail inflation hits 7.35% and the food inflation hits 14% in the month of December. The hike in retail inflation was shared by the telecom operators as their top-up package price was increased and mainly due to the food prices which paid the reason for the hike. Onion price was nearing ₹180 and it was the most obvious reason. Will the inflation decrease in the mon...
Post a Comment
Read more

Co-Op Banks under RBI

By
Cabinet committee has promulgated an ordinance to bring around 1500 cooperative banks under the supervision of RBI. This announcement is expected since the scams exposed in the Punjab and Maharashtra Cooperative Bank last year. The cooperative banks (State and other) are scheduled banks under RBI Act that should submit Cash Reserve Ratio to RBI but doesn't have supervision by RBI in their CEO appointments, auditing and lending ratio. The purpose of the formation of cooperative societies or banks is to serve a small or rural community by the community itself. These banks were the alternative to other commercial banks that denies access to the downtrodden section of the society. But these cooperative banks were not functioning as they wanted to. Since there is no auditing and interference by the central bank, corruption and bribery were increased in these banks. Banks instead of proving loans to the needy, they ended providing a large part of its loans to a single party or a smal...
Post a Comment
Read more

THE BLOOD BEHIND THE BEAUTY - FOETUS IN COSMECEUTICALS

By
This article is written by inspiration from the movie “Yashoda” starring Samantha, until watching it, I hardly would have thought the link between fetus  and cosmeceuticals. Aftermath of the movie, curiosity peeped in, to know the truth value of facts shown on the screen. So, here is my perception about the film (Yashoda) concerning utilization  of fetus  in beauty creams. What has been shown in the movie? An institute called Eva, braced by the Central Minister and his associates which targets poor women for making them as surrogates (by fulfilling their monetary needs) to celebrities and huge barons of the society. When those women successfully complete their first trimester, they are handed over to the reticent institute, through the assistance of local hospitals wherein they are sumptuously taken care with all the facilities, but those women are getting widely disconnected from the outside world. Once, they reach their third trimester, they are induced with false p...
1 comment
Read more