The International Monetary Fund (IMF) has said that India continued with labour reforms and privatisation despite the pandemic, calling the government’s response to the Covid-19 pandemic situation as “swift and substantial”.
The IMF in its report based on “consultations” among members, however, sounded a note of caution saying that the economic outlook remains “clouded” due to pandemic-related uncertainties, contributing to both downside and upside risks.
In its “Article IV” consultations report, it further said that a persistent negative impact of COVID-19 on investment and other growth drivers could prolong the economic recovery.
On the Indian government’s handling of the pandemic, the multilateral agency said it was “swift and substantial…has included fiscal support, including scaled-up support to vulnerable groups, monetary policy easing, liquidity provision, and accommodative financial sector and regulatory policies”.
“Despite the pandemic, the authorities have continued to introduce structural reforms, including labour reforms and a privatisation plan,” the report said.
The IMF has projected India’s economic growth at 9.5 per cent in FY2021-22 and 8.5 per cent in 2022-23.
“The economic outlook remains clouded due to pandemic-related uncertainties contributing to both downside and upside risks. A persistent negative impact of COVID-19 on investment, human capital, and other growth drivers could prolong the recovery and impact medium-term growth,” it said. —WITH PTI