Slowdown cyclical, growth will pick up in next few years: Bimal Jalan

PTI New Delhi | Updated on August 04, 2019 Published on August 04, 2019

Former RBI Governor Bimal Jalan   -  The Hindu

He points out out that the situation today is very different from 1991 and sees unemployment as a very important problem.

The current slowdown in the Indian economy is cyclical and growth will pick up in one or two years, former RBI Governor Bimal Jalan said on Sunday.

Jalan further said the government has already announced many reforms, and it is now a question of implementation, particularly in terms of investment.

“The slowdown in the growth is cyclical. In one or two years, I am sure, there will be a turnaround,” he told PTI in an interview.

Jalan also pointed out that the situation today is very different from 1991 when the country faced a severe economic crisis on the external front.

“India is in a very strong position today, unlike in 1991. If you look at our inflation rate, it’s quite low. If you look at our reserves, it’s quite high,” he asserted.

Last month, the IMF and Asian Development Bank (ADB) had cut India’s growth forecast, citing global and domestic headwinds.

Read also: Citing weak demand, IMF lowers India’s growth projection to 7%

According to the IMF’s latest projection, the Indian economy is estimated to grow at 7 per cent in 2019 and 7.2 per cent in 2020. The Asian Development Bank had also lowered India’s GDP growth forecast to 7 per cent for the current year on the back of fiscal shortfall concerns.

Private sector investment

Asked why the private sector still not investing, Jalan said, “It may be due to post-demonetisation effect or may be they were waiting for (Lok Sabha) election results.”

On overseas sovereign borrowings, he said they should be long-term.

“The government has already announced that it (overseas borrowings) will be for 5-20 years, it should not be for short-term,” the former chairman of the Expenditure Management Commission said.

Finance Minister Nirmala Sitharaman in the Budget for 2019-20 had announced that the government would start raising a part of its gross borrowing programme from external markets in foreign currencies.

Asked what were the biggest risks for the Indian economy, Jalan, also a former member of Parliament, said he thinks unemployment is a very important problem.

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

Published on August 04, 2019
This article is closed for comments.
Please Email the Editor