23 AUG,2020 | MEDC
India’s road to economic recovery is likely to be long and convoluted. There are risks of stagflation i.e. recession combined with rising inflation. Declining oil prices have turned India’s current account balance into a surplus, but that is just a passing phase. As the global recovery proceeds, imports will rise, leading again to a trade deficit. The government is focusing on enhancing employment prospects in rural areas, as a large chunk of the migrant workforce is still there. Developing agribusiness opportunities therein will incentivize them to stay and contribute to nation building activities. Policymakers need to further stimulate investment and ease of doing business through the resumption of long-pending structural reforms. This needs to be done at the earliest, as past experience suggests that it could take up to a decade for the reform process to work itself out in the desired manner.
*Photo Credit: Google