Coronavirus Even if the global economy is shaken. But next Financial By the end of the year (2021-22), the country will once again be in the throes of economic growth, according to Rajiv Kumar, vice-chairman of the government’s think tank Policy Commission.
The Reserve Bank of India (RBI) has also slashed its growth forecast for the current fiscal to 7.5 per cent from 9.5 per cent. Asked about the growth forecast for the year 2022, the vice-chairman of the policy commission said, “We will definitely reach the level before the Covid 19 epidemic by the end of the next financial year (2021-22).”
GDP is projected to be less than 8 percent
He said the decline in GDP is projected to be less than 8 per cent in the current financial year (FY). The Indian economy has registered a better-than-expected recovery in the September quarter of the current financial year due to increased manufacturing activity. The economy contracted to 7.5 per cent in the July-September quarter. Further better consumer demand is expected to further improve the state of the economy.
The government aims to disinvest Rs. 2.10 lakh crore is to be collected. Out of this, Rs 90,000 crore will be raised from sale of stake in Central Public Sector Undertakings (CPSE) and sale of government stake in financial institutions.
The banking sector will be the area
Asked about the reforms in the banking sector, Kumar said the sector needs to be further expanded as well as increased competition as the country’s private debt to gross domestic product (GDP) ratio is quite low. In the case of other emerging economies, it is more than 100 percent.
“In such a scenario, we need to increase private debt, which will be possible only when our banking sector expands,” Kumar said. On the country’s agricultural sector, Kumar said the policy commission was promoting chemical-free natural farming. It has the potential to drastically reduce the cost of agricultural production. Also, it will have a very positive effect on the environment.