Our economic recovery requires a broader base
It’s now amply clear that a revival has taken shape after the convulsions of covid, but India’s economy must improve on many more counts before it can regain the broad vigour it needs
The latest report published by the Reserve Bank of India (RBI) on the state of our economy strikes an optimistic note. Monetary and credit conditions are conducive for a “durable recovery" to take shape, it says, even as indicators of aggregate demand point to a brighter outlook for the near-term amid uneven but clear gains visible across sectors. Farm harvests have been abundant, manufacturers now have better operating conditions and services are in expansion mode. Headwinds from overseas do spell uncertainty, the report notes, but India currently stands apart from a global situation “marred by supply disruptions, stubborn inflation and surges in [covid] infection in many parts of the world." Vaccination coverage has improved and exports are back up. It also highlights a recent shift in government spending towards capital projects and speaks of “signs of ebullience" in the job market. “Overall economic activity is on the cusp of a revival."