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    We're optimistic about a V-shaped recovery in India: Expenditure Secretary TV Somanathan

    Synopsis

    The expenditure secretary said simply pumping money into the system was not a solution to revive the economy.

    Somanathan cautioned against the demands for a bigger fiscal stimulus package. While agreeing that what has so far been announced was not sufficient to revive the economy, he said simply pumping money into the system was not a solution.
    The government is optimistic about the economy’s trajectory of recovery and expected a V-shaped recovery, said TV Somanathan, expenditure secretary, during an online conference on Thursday.

    “I must tell you that we are somewhat optimistic that among the various shapes of recovery....we are expecting something like a V-shaped recovery. This year being at the bottom of the V and the next year being closer to the top of the V,” Somanathan said.

    The statement came amid improvements in various indicators from rising goods and services tax collections to falling unemployment, showing a gradual pick up in activity since May.

    “I think we will end this year reasonably well. We will probably not do as badly as the worst expectations expect from us,” he added.

    Somanathan cautioned against the demands for a bigger fiscal stimulus package. While agreeing that what has so far been announced was not sufficient to revive the economy, he said simply pumping money into the system was not a solution.

    “It is not prudent to assume that you can simply pump prime your way through this crisis. In fact it's our view that you cannot do it because even if you add more into the system, until the pandemic is behind us, we are not going to see proportionate results,” he said.

    However, he did not rule out the possibility of further stimulus measures.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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    10 Comments on this Story

    Subbu India36 days ago
    Even if the economic condition improves the condition of Sr Citizens will remain worse than ever.
    Dillip Patnaik36 days ago
    Prior to Coronavirus the Indian economy was running in snail’s pace. Now the due to the Coronavirus the economy is in real trouble. Mr. secretary’s V shape economic growth is very unrealistic. There are many millions of unemployed laborers and poor farmers need true government support in order to move the economy. This should be the first priority along with management of Coronavirus.
    Jagdip Vaishnav36 days ago
    On the contrary ,worst time still to come.
    The Economic Times