India’s former Chief Economic Advisor Arvind Subramanian said that India’s reduced growth forecasts by various research agencies after the. outbreak of COVID-19 pandemic are “way too optimistic” and impact will be even worse than what we are expecting.
He was addressing a webinar organised by National Council of Applied Economic Research along with public policy expert Devesh Kapur of Johns Hopkins University. The duo suggested to do over with the recommendations of the first report of the Fifteenth Financial Commission and the commission should not submit its report till the pandemic is truly dealt with, as far as by the end of 2025-26.
According to them the numbers given by the agencies like IMF are too optimistic to be believed. When one month’s loss could bring down GDP by 3 percent, this lockdown is huge and the collapse will be devastating.
Kapur suggested that the centre should share the resources borrowed from bond market with the states besides what it distributes from the divisible tax pool and other grants. According to him, the state governments are suffering a lot in such situations.
