Don’t read too much into green shoots, cautions RBI former Governor

New Delhi, August 23

Calling "green shoots" of economic revival as a mechanical rebound, former Reserve Bank Governor D Subbarao says India's short and medium term growth prospects continue to remain grim and the government should not read too much into the economic activity coming back from the depressed base of lockdown.

Indian economy was in a troubled state when the pandemic hit the world. Before the Covid-19 crisis hit India, the real GDP growth had moderated from 7 per cent in 2017-18 to 6.1 per cent in 2018-19 and to 4.2 per cent in 2019-20.

"When the crisis is behind us — and I hope that is soon enough — these problems are going to be much bigger. Fiscal deficit is going to be much higher, the debt burden much larger and financial sector in a worse shape," he said. — PTI

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