New Delhi: India’s GDP growth will see strong recovery from the second quarter of this fiscal as economic activities resume, Niti Aayog Vice Chairman Rajiv Kumar said.
He also expressed hope that the government will unveil fiscal measures to jumpstart growth, which has plummeted due to the Covid-19 crisis.
In an interview with a news channel, Kumar said April would be a washout in terms of economic activity, though all has not been lost for agriculture.
“Once economic activity starts in the second quarter, I think you will see a fairly strong recovery in the country for the next three quarters of financial year 2020-21. To support that I am sure the government will come up with a fiscal stimulus.”
“There is a clear understanding within the government and Reserve Bank of India (RBI) that we have to do whatever it takes to get the economy back on track. We know that the implications of a very weak growth are going to be negative,” he said.
Kumar said he is convinced that with the fiscal policy package now in the making, India will see economic activity recovering quite strongly from the second quarter of 2020-21.
Replying to a question about delay in announcing another fiscal package, the Niti Aayog vice chairman said the country’s diversity is significant to come up with a pan-India solution and it takes time to develop guidelines.
“Plus, we do not have the luxury of unlimited resources at our disposal. So we have to figure out what is the cloth that we have (with) which to cut our coat, as it were. So, that is being considered quite actively.”
“I know that some of us are being impatient, but the request from us would be to have a bit more patience because at this point of time it is important to get it right and it is important to therefore take as many variables on board as we can before something like that is announced,” he said.
The Centre had last month announced a Rs 1.70 lakh crore package to help people survive the Covid-19 crisis. The measures included free food grains and cooking gas to poor for the next three months, one-time doles to women and poor senior citizens, higher wages to workers and steps to boost liquidity of employees. The IMF on Tuesday projected a GDP growth of 1.9 per cent for India in 2020.
Kumar’s comments came after Prime Minister Narendra Modi announced the extension of the nationwide lockdown till 3 May. The Prime Minister on Tuesday also declared that select necessary activities will be allowed to be opened up from 20 April in identified areas.