The Foundation Of The Economy Is High, Corona Will Not Impact

The foundation of the economy is high, Corona will not impact after the first quarter, the economy will be strengthened along with vaccination.

RBI monetary policy reviewer (MPC) member Ashima Goyal has expressed confidence that the pressure on the economy due to the second wave of the Corona crisis will not be seen after the first quarter of the current financial year.

She said on Tuesday that the economy will start to perform better once the country’s large population gets vaccinated against the corona.

In this, increasing demand from every region of the country, improvement in the global economy, and facilities in the financial market will go a long way.

Eminent economist Goyal said that India has the potential to become the center of global vaccine production. Soon there will be a sharp increase in production.

The way the restrictions have been prioritized at the regional level this time, instead of a nationwide lockdown, have helped to halt the spread of Corona.

The foundation of the economy is high: The supply chain has not been hampered by the local lockdown as it was last year.

This new system has proved that there is no need for a complete lockdown of the country.

Recently, rating agency S&P Global lowered the country’s growth rate estimate to 9.8 percent for the current financial year.

The agency said that the second wave of Corona has slowed the growth rate of the economy. Rating agency Fitch also lowered the growth rate estimate for the current financial year to 9.5 percent.

Regarding how the government views the fiscal deficit amid these estimates from rating agencies, Goyal said that India’s fiscal position was better than the developed economies post-Corona compared to developed economies last year.

Goyal said that the rating agencies are also confident that there is no impediment to India’s growth journey in the long term and they would like to see the current fiscal situation of the country from that point of view.

As far as making the country a five trillion dollar economy is concerned, Goyal said that it may take some more time given the challenges of the current Corona crisis.

It is noteworthy that the government has set a target of making the country an economy of five trillion dollars by the year 2024-25.

She also said that to make banks more efficient, their need for privatization is in place.

But for now, banks should focus on increasing credit disbursements and providing adequate liquidity in the market, as the economy will gain momentum from this.

Returns will be good in the second half.

Morgan Stanley has said in a report that the slight pressure presently on the Indian equity market will show good earnings during the second half of this year (July-December 2021).

The US brokerage agency believes that given the growth, stability, government and Reserve Bank of India (RBI) policies, and corporate earnings, it can be said that the future is going to be good for the equity market.

It is noteworthy that on Tuesday itself, the 30-share Sensex of BSE has again reached the level of 50,000.