It is not a fiscal stimulus, alternative measures are needed to boost the economy: Rajiv Kumar
NEW DELHI: The government should focus on alternative measures to stimulate the economy, since it is not possible to provide fiscal stimulus, said Niti Aayog Vice President Rajiv Kumar before the budget.
Kumar also said that measures to improve growth are the need for time to reach India's potential growth rate of 7-8 percent annually.
He attributed the current slowdown to low investment, silenced consumer spending and lagging exports.
Experts are divided on whether the government should provide a stimulus to boost the economic slowdown without worrying too much about the fiscal deficit.
Measures to improve growth are the need for time to reach India's potential growth rate of 7-8 percent annually.
However, the government's ability to finance a great stimulus is certainly limited. Therefore, attention should be paid to alternative measures to stimulate recovery, Kumar said in an 'arthNITI' newsletter.
Niti Aayog vice president said some green recovery outbreaks are now visible with the Purchasing Managers Index (PMI) for both manufacturing and services that show a smart increase above 52, which means expansion.
He also said that the government has already taken many measures in the recent past, including the decision to reduce corporate tax rates in September 2019.
The equity markets have responded positively and strongly to these measures and have registered record highs. However, all eyes are on new measures to improve growth, Kumar said.
Noting that growth, equity and sustainability can no longer be seen as mutually exclusive, he said: We cannot achieve a goal while neglecting the other two.
Kumar said that our policy design should always have these three main objectives that are also enshrined in the Sustainable Development Goals (SDGs) or the 2030 Global Agenda, for which achievement, all UN members have given their unequivocal commitment.
the Indian economy , que hasta hace poco fue aclamada como la principal economía de más rápido crecimiento, ha visto una disminución en la tasa de crecimiento en cada uno de the últimos cinco trimestres, cayendo a un mínimo de más de seis años del 4.5 por ciento en julio-septiembre de 2019.
the National Statistical Office (NSO) has estimated the gross domestic product (GDP) in the current financial year at 5 per cent, which is 11-year low.
During the current year ending in March 2020, the fiscal deficit target has been set at 3.3 percent of GDP.
However, there are fears that the government may lose the objective in view of the slower economic growth and the likely deficit in revenue collection, mainly due to a massive cut in the corporate tax rate.
Finance Minister Nirmala Sitharaman will present the 2020-21 Budget on February 1.