Indian Economy at doorstep of revival process

RBI governor Shaktikanta Das, has said that the Indian economy, which has been severely affected by the ongoing coronavirus pandemic, is at the doorstep of revival. He added: “We are almost at the doorstep of revival process and it’s very important that the financial entities have adequate capital (to support growth).”

Expressing confidence that the policymakers will be able to overcome challenges caused due to Covid, Das said that the government will have to spell out a fiscal roadmap post-Covid. “I think post Covid, once there is containment of pandemic, the government will certainly have to spell out a fiscal roadmap that India should adopt,” he noted.

The RBI governor also emphasised on the need to build capital buffers for banks and non-banking financial companies (NBFCs) to deal with stress caused by the pandemic. “Both fiscal and monetary policy were counter-cyclical and accommodative and both were working in close symmetry,” he said, while stating that the fiscal measures taken by the government to deal with the pandemic have so far have been well calibrated and prudent. In its monetary policy meet earlier this month, Das had stated that the Indian economy is entering into a decisive phase in fight against coronavirus and contraction in Q1 economic growth is behind us.