Raghuram Rajan Advice: Government needs to spend ‘carefully’, worrying about inflation is also important

Raghuram Rajan Advice to Center: Former Reserve Bank Governor Raghuram Rajan has said that the Indian economy has some ‘dark spots’ along with the ‘bright spots’, so the government needs to ‘target’ its spending carefully, to keep the fiscal deficit from reaching very high levels. to be prevented from.

Need to stop ‘K’ shaped curve in economy
Rajan is known to put forth his views clearly. The eminent economist said that the government needs to take more measures to stop the revival of the ‘K’ shape of the economy. In general, technology and large capital companies in K-shaped revivals tend to improve faster than small businesses and industries most affected by the pandemic.

Rajan expressed concern over Indian economy
Raghuram Rajan said, ‘My biggest concern about the economy is about the middle class, small and medium sector and our children. All these things will come into ‘Khel’ after the initial revival from suppressed demand. The ‘symptom’ of all these is weak consumer demand. The demand for consumer goods, especially on a large scale, is quite weak.

Good performance of IT, Healthcare
Raghuram Rajan is currently a professor at the Booth School of Business at the University of Chicago. He said that there are always dark spots along with bright spots in the economy. He said that if we talk about shiny areas, then healthcare companies come in it. Apart from these, Information Technology (IT) and IT-allied sectors are doing tremendous business. Unicorns (valued at over $1 billion) have been formed in many sectors and some segments of the financial sector are also strong.

Concern was also expressed on the education of schools
The former RBI governor said, “Talking about the dark spots, unemployment, low purchasing power (especially in the lower middle class), financial pressure of small and medium-sized companies comes in this.” Apart from this, in the dark spots comes the sluggish growth of debt and the education of our schools.

Rajan said that the new form of the corona virus is a setback for both Omicron medical and economic activities, but at the same time he cautioned the government against a K-shaped revival. Rajan said that we should take all possible measures to stop the revival of ‘K’ shape.

Express your opinion about the budget
The growth rate of the Indian economy is estimated to be nine percent in the current financial year. In the last financial year, the Indian economy had declined by 7.3 percent. The Union Budget for the financial year 2022-23 will be presented on February 1. Before the budget, Rajan said that the budget document is a ‘view’. “I want to see five or 10 years’ vision for India,” he said.

India’s fiscal position was not very good even till the outbreak of the pandemic: Rajan
Asked whether the government should take steps for fiscal consolidation or continue with the stimulus measures, Rajan said India’s fiscal position was not good even till the pandemic struck. ‘This is the reason why the Finance Minister can no longer spend with open arms.’ He said that the government should spend where it is needed. ‘But we need to spend carefully, so that the fiscal deficit does not reach too high.’

Inflation also a matter of concern for India: Rajan
Regarding inflation, Rajan said that today ‘inflation’ is a matter of concern for all the countries of the world and India cannot be an exception.

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