India in a whirlwind of severe economic depression

New delhi date. December 24, 2019, Tuesday

Stating that India is in the midst of a severe economic downturn, the International Monetary Fund (IMF) has urged the Government of India to take immediate policy steps to tackle this long recession. According to a report issued by the IMF, India's rapid economic expansion in recent years has left millions of people out of poverty line.

However, the growth of the economy in India has slowed down due to the impact of various factors. The slowdown in economic growth rate is currently becoming an issue for India. We believe that this recession is cyclical and not temporary, and that it is caused by a breakdown in the financial sector. The recovery will not be as fast as previously reported, "IMF's Renil Salgado told PTI.

The IMF has issued an annual report on India depicting the economic situation of the country.

While the risks associated with Outlook are shrinking, the Government of India has also emphasized on continuing strong macroeconomic management.

Due to the formation of strong government at the Center, they have the opportunity to carry forward the reform program, the report said. The report was prepared in August, when there was no indication of India's current economic downturn. India is currently in the midst of a major economic downturn, Salgoda said.

In the second quarter of the current financial year, the country's economic growth rate has been reduced to 8 years with a growth rate of 8.5% and the growth factors indicate that domestic demand has increased by only 2% during this period.

Most high-frequency indicators indicate that economic activity continued to decline in the December quarter as well. The IMF believes the decline in credit growth in non-banking financial companies has impacted economic activity.

Private investment is being hampered by financial sector problems and a decline in business confidence. It also expressed the view that some issues had also played a role in the implementation of reforms such as GST.