India expects V-shaped recovery next fiscal: DEA Secretary Tarun Bajaj
Business Today , Jul 23, 2020
The central government is expecting India to make a quick 'V' shaped economic recovery from the sharp fall in GDP growth caused by COVID-19 lockdown and economic disruptions, says Tarun Bajaj, secretary, Department of Economic Affairs, Ministry of Finance.
Addressing the online Capital Market conference organised by apex industry chamber FICCI, Bajaj said the ministry finds several economic indicators like e-way bills, GST collections, freight traffic and railway collections show promising growth in June and July as India began 'unlocking' the economy after the national lockdown in April and May.
"In June and July economic growth is more promising than we have thought. The 14 to 15 parameters we are tracking are showing promising results," he said. Bajaj said that while India's GDP will shrink this year, it will be a 'V' shaped recovery next year unless COVID-19 hits the country very hard, which is highly unlikely.
He said that the government is comfortable with the revenue figures and is not looking at monetisation as a possibility to generate more resources at the moment.
The secretary said the government is planning to announce production-linked incentive schemes to support domestic manufacturing in four to five sectors. The industrial segments that will be chosen for the support will be a mix of sunrise sectors, export oriented sectors and sectors that are facing serious challenges due to the economic disruption, Bajaj said. The schemes will be modelled on the ones already announced for the electronic (mobile phone) sector, the medical devices segment and bulk drug manufacturing.
Bajaj said that the government will expand the scope of the MSME credit support scheme to benefit more people who are facing liquidity crisis in the wake of COVID-19 shut down. He also pointed out that the government's policy reforms in recent times, especially in the area of agriculture, coal mining and privatisation have had positive impact.
"There is a lot of interest in the road and rail transport sector. Twenty companies, including major ones, participated in the pre-bid conference for running private trains. There has been interest in participating in the six airports which are to be handed over to private players on PPP mode. Two lot of another six airports each are also coming up soon," Bajaj said.
To achieve global scale, Indian banking sector needs to implement Fintech: Chief Economic Adviser Dr Krishnamurthy Subramanian