India’s GDP contraction should alarm everyone: Raghuram Rajan

7

New Delhi, Sep 7 | A week after India reported a significant contraction in its GDP during the April-June quarter of 2020-21 fiscal, former Reserve Bank Governor and noted economist Raghuram Rajan has said that the negative GDP growth numbers should alarm everyone.

Emphasising on the importance of government relief or support in the given scenario, he pointed out that it is “meagre” so far.

In a note published on LinkedIn, he also opined that the 23.9 per cent contraction in the GDP during the Q1 would be “even worse if the damage to the informal sector is taken into account”.

“The recently released quarterly GDP growth numbers for the first quarter of FY2020-21 should alarm us all. The 23.9 per cent contraction in India (and the numbers will probably be worse when we get estimates of the damage in the informal sector) compares with a drop of 12.4 per cent in Italy and 9.5 per cent in the United States, two of the most Covid-affected advanced countries,” Rajan said.

He said that India is “even worse off” than these comparisons suggest.

Since the coronavirus pandemic is still raging in India, discretionary spending, especially on high-contact services like restaurants, and associated employment, will stay low until the virus is contained, Rajan said, adding that government relief becomes all the more important in the given scenario.

However, the government support so far has been “meagre”, he said, primarily in terms of free food grains to poor households and credit guarantees to banks for lending to small and medium (SMEs) firms, where the takedown has been patchy.

“The government’s reluctance to do more today seems partly because it wants to conserve resources for a possible future stimulus. This strategy is self-defeating,” the former RBI Governor said.

According to him, at a time when the government should expand resources to spend more and take more action, the Indian government “seems to have retreated into a shell”, after an initial burst.

He said that the government and public sector firms should clear their payables quickly so that liquidity moves to corporations.

In addition, small firms below a certain size could be rebated on corporate income and GST tax they paid last year, or some portion thereof, with the rebate tapering off with firm size.

This would be an objective way of helping small, viable firms based on a hard-to-manipulate metric, even while rewarding them for their honesty, Rajan said, adding that finally, the government will likely have to set aside resources to recapitalise public sector banks as the extent of losses are recognised.

According to Rajan, the private sector should also be urged to give a helping hand.

“Cash-rich platforms like Amazon, Reliance, and Walmart could help smaller suppliers get back on their feet — even funding some of them. All large firms should be incentivised to clear their receivables quickly,” he said.

Source: IANS

Sponsors Posts

From being a developer to a CEO in California, Manthan Dudeja's top tips to make money while you're still in college

From being a developer to a CEO in California, Manthan Dudeja's top tips to make money while you're still in college

Gone are the days when one had to finish school, college and subsequent years in getting trained to be able to sustain oneself with decent income. Today, what you earn eventually depends upon your skillset and how early you got started to build an expertise in your domain.

Manthan Dudeja, who currently lives in California and is still in his graduation years, understood the perks of starting early and is now a CEO who has worked across a plethora of jobs, from IoS programming to website development and blogging to trying his hand at Amazon Associates.

In conversation with this dynamic entrepreneur, let’s decode the various options for freshers to make a side income while they are still in school/college –

  • Content writer/Editor

Manthan explains how he started off by writing for blogs with whatever knowledge he had and with the help of internet, this could be by either writing for your own online blog, for instance Manthan was interested in Tech, so he was writing for his blog ‘TechCrack‘ or for someone else in the capacity of a content writer.

It’s not difficult to get started if you have the basic understanding to develop a ‘flow’ while writing a piece and the skill to write what suits your target audience.

  • Software developers/ Programmers/ Coders – Today, software/app developers are earning more than the average of $60 an hour by working remotely. There are a host of online paid/free platforms providing trainings to acquire such skills, Manthan has been an app/website developer for the longest time and by far, this skill has given him the best results for his work.
  • Digital Marketer/ E-Marketer-

Your journey to become a digital marketer starts the day you take the step of self-educating yourself and learning the tricks to attract potential customers either by way of Google, Facebook, or any other digital platform by a host of scalable ways on the internet, undoubtedly, digital marketing is the hottest online work from home concept of this decade.

Manthan is today a successful digital marketer who has equipped himself with the advanced knowledge of online ads on various mediums and has effectively used these skills to generate incredible revenue over time.

These are some of the best ways to get started, according to Manthan, all

 

Sponsors Posts

2 BHK Residential Apartment for Sale in Aadhya Hills Bhita Jabalpur

2 BHK Residential Apartment for Sale in Aadhya Hills Bhita Jabalpur
Aadhya Hills is one of the residential development. It offers spacious and skillfully designed apartments. The project is well equipped with all modern amenities to facilitate the needs of the residents.
  • Property type: Residential Apartment 
  • Offer type: For Sale 
  • City: Jabalpur 
  • Zip Code: 482001 
  • Locality: Bhita 
  • Landmark: Bhita 
  • RERA Registration Number: P-JBP-18-1599 

For more details please click here or visit bhaskarproperty.com

LEAVE A REPLY

Please enter your comment!
Please enter your name here