New Delhi, Jan 11: As IHS Markit said in its report, the Indian Economy will overtake Japan by 2030, now reports suggest that the Indian economy will grow by 9.5% in the current fiscal year. Former chief economic adviser Arvind Virmani has said that the economic growth in the current fiscal year will be higher and close to 9.5 per cent.
Addressing a virtual event organised by industry body PHDCCI, Virmani said that government expenditure and exports have peaked, but so far private consumption has not recovered due to the COVID-19 pandemic.
According to the recent government data, the Indian economy is estimated to grow at 9.2 percent in 2021-22, as against 7.3 percent contraction in 2020-21.
The Reserve Bank of India (RBI) has lowered the growth projection for the current financial year to 9.5 per cent, while the International Monetary Fund (IMF) has projected a growth of 9.5 per cent in 2021, and 8.5 per cent in the next year.
The eminent economist said that India’s GDP growth is now positive, but job growth is lagging. Stressing that Micro Small and Medium Enterprises (MSMEs) are critical for inclusive growth, he said that modern MSMEs should have full opportunity to compete with the corporate sector.
Virmani noted that COVID-19 pandemic hit economic recovery and pushed for tax reforms. GST council seems focused on short-term revenue maximization, he said.
"Revenue negative GST simplification needed to provide consumption stimulus to the economy, and quickly restore lost jobs and wages," he said.
As the Indian economy emerges from the depths of economic contraction and slowdown caused by Lockdown, the Indian economy will see its first booming year after several gloomy ones. This economic forecast will give necessary confidence to domestic as well as foreign investors.