Indian Economy Recovering Faster than Expected – IMF

Indian Economy Recovering Faster than Expected - IMF

The Indian economy had faced a complete downturn after the Covid-19 pandemic leading to a complete shutdown of the country. But the good news is that it is quickly getting back onto rails, and that too much faster than expected.

While talking to reporters on Thursday, IMF Chief Spokesperson Gerry Rice, emphasized that while India had been largely affected by the Covid-19 lockdown, the country is also recovering quite fast. In the quarter-ending September 2020, the upturn in the manufacturing sector alone helped GDP achieve a lower contraction of 7.5%. This growth is likely to increase further as the consumer demand slowly picks up.

To further emphasize her point, Rice said that she feels that the Indian authorities should prioritize quick execution of the support programs already chalked out and may need to expand their scope further to drive higher growth levels.

The Government of India has announced measures that will cater to the needs of varied sectors of the economy, including businesses, agriculture, and households that are particularly vulnerable to the economic effects of the pandemic. The fiscal, monetary, and financial sectors have been roped in to provide much-needed support.

This aspect has been further elaborated by the Union Finance Minister Nirmala Sitharaman in her address to the ministerial-level committee of the IMF, the International Monetary and Financial Committee (IMFC). She said that a V-shaped recovery is being noticed in several high-level indicators.

India’s recovery strategy is right on track. In October 2020, Malhar Shyam Nabar, Division Chief, Research Department, IMF had said that the need of the hour for India is to focus more on the direct spending and tax relief support than on the liquidity support measures and the credit guarantees.

On the monetary policy aspect, the Reserve Bank of India has been aggressive on the relief measure to bring the country back on stable grounds. The fact that the IMF has lauded India’s recovery speed is proof and testimony to that.

Robert Jones

Robert Jones

Robert Jones has joined FinanceStead team recently. He has more than a decade of experience in writing general news. Before joining our team, he worked as a freelance writer. Now, he writes for business news, finance news, banking and investment related news articles. In his free time, he loves to read books about investment strategies.

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