“We predict fairly robust growth for India,” said IMF’s Kristalina Georgieva.
Washington:
The EU budget presented by Finance Minister Nirmala Sitharaman is a very “thought out” policy agenda for India and places great emphasis on innovation in research and development in human capital investment and digitalisation, said IMF Managing Director Kristalina Georgia.
Finance Minister Sitharaman unveiled a Rs 39.45 lakh crore budget Tuesday, with increased spending on highways to affordable housing with a view to fueling the economy’s key engines to support a global recovery from the pandemic.
In the budget, she emphasized spending on infrastructure to create jobs and stimulate economic activity.
The budget for the fiscal year starting in April 2022 proposed a massive 35 percent increase in capital expenditure to Rs 7.5 lakh crore, coupled with the rationalization of customs duties, extending the time for setting up new manufacturing companies and plans to launch a digital currency and tax crypto assets.
“We foresee pretty robust growth for India. Yes, there’s a small write-down from our previous projection of 9.5 percent to 9 percent for 2022. But then we also have a small mark-up for 2023, because we think we’re will see stable growth not much different from (the one projected by) the (Union) finance minister,” Georgieva said during a virtual roundtable with a group of reporters on Thursday.
The International Monetary Fund (IMF) sees that this is dependent on a number of factors, including that they will continue to function better during the Covid-19 pandemic and should the pandemic continue, and that the tightening of financial conditions would be done. with clear forward guidance and in a careful manner, without causing greater shock, she said.
“As a matter of fact, so far we see that the tightening of financial conditions does not translate into a major problem for emerging markets. Compared to previous periods, the impact on rates is not significant at all. Why? Because emerging markets have worked to build buffers and to build strength for situations like this and because many of them have taken cautious steps themselves as soon as they faced inflationary pressures,” she said.
“We are very positive that India is considering addressing short-term challenges, but also long-term structural transformation, and that great emphasis is placed on innovation in research and development in human capital investment and digitization, and after to think about how India can accelerate the climate change agenda using economic tools for it,” Georgieva said.
“So all in all, I read the (budget) statement and I thought it was a very thoughtful policy agenda for India,” the IMF-MD said in response to a question.
The Center on Tuesday increased the budget allocation for the Union Ministry of Environment from the last fiscal by 5.6 percent, but reduced the pollution control allocation by Rs 10 crore.
However, the government increased the national mission budget for Green India from Rs 290 crore in the past fiscal year to Rs 361.69 crore this year, with the National Afforestation Program alone being allocated Rs 300 crore, more than the amount of Rs 235 crore last year. year .
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