– by Pragya Mishra
The economy being the prime topic in the country today, it was just logical that the bi-monthly monetary meeting would attract most of the eyeballs. Governor Shaktikanta Das, yesterday announced the outcomes of the meeting.
It is quite clear that the citizens should bank on the fourth quarter of the year 2020-21, for all the positive news and something to cheer about. The signs of recovery in the economy are fairly strong and according to the governor, we might see a growth of around 0.5% (Real GDP) in the fourth quarter. Although the overall yearly projection is still appearing to be in negative at (–)9.5%.
In the meeting, RBI decided to maintain the repo rate at 4% and the reverse repo rate at 3.35%. which signifies an accommodative attitude on behalf of the reserve bank as far as the banking sector is concerned, according to Governor Das. At the same time, a series of measures have been taken by the reserve bank to infuse liquidity and to keep the bond yield in control. Some of these measures are, to boost the fund flow in real retain and real estate sector the requirement of risk-weighted assets is been lowered by the bank, and at the, there are open market operations for state development funds.
There were many talks as far as the shape of the recovery was concerned, whether it will be V, U, L, W or K shaped, governor Das, did not actually authorize a particular shape instead he said “In my view, it is likely to predominately be a three-speed recovery, with individual sectors showing varying paces, depending upon sector-specific realities”.
The numbers and the figures put forward by the Bank and different other agencies of the govt are appears to be promising and gives a picture that the country has left behind the brunt of the pandemic and the economy has recovered to pre-COVID pace, but the time of celebration hasn’t arrived yet as different sectors are choosing different paces to recover and the unemployment problem although mitigated but still persist to each sector respectively. This might make “The great Indian Growth Story” to wait a little longer before it can actually take off.