In a recent interview with the PTI, Pangariya described the government’s decision to privatize two public sector banks next fiscal as an “unprecedented” effort to “finally right a wrong done 50 years ago”.
Estimated Growth in GDP
The country’s GDP a year ago returned to a hair’s breadth above its level. This estimation was of the October-December 2020 quarters. Panagariya said,” At 0.4%, the year-on-year-growth in GDP may seem low but given the large negative growth during the preceding two quarters((-)24.4% during April-June and (-)7.3% during July-September)’, the quarter-on-quarter growth momentum is very strong.” For 2019-20, in January, the growth rate was revised from 4.2% to 4%. For the third quarter of the last fiscal, the real GDP growth has scaled down to 3.3% from 4.1%.
Proposed Asset of The Government
On the government’s proposed asset, Panagariya said,” one or the other way, we need a rapid cleanup of NPAs”. It will be a major step in the right direction if the government can move swiftly to set up the bad bank and take out the bad assets from the bank balance sheets. To protect the poor, the government wants low inflation but what matters for the poor is the food inflation on which there is little control over the RBI.
TPT Policy Advocacy & Recommendations
- The main challenges come from the rising oil prices and fiscal pressures. The Government must bring in some other initiatives to boost up the GDP.
- The economy of India was slowed down due to the global pandemic. If the proposed asset of the government works well, then India can revive well from the losses in the economy.