New Delhi, Jan 25 (PTI) The Indian economy has recovered 'handsomely' from the pandemic-induced disruptions, former Niti Aayog Vice Chairman Arvind Panagariya said on Tuesday, while expressing hope that the recovery will be sustained and the growth rate of 7 to 8 per cent will be restored.
Panagariya suggested that the government must now signal its intention to wind down fiscal deficit by cutting it by half-to-one percentage point in 2022-23.
'The Indian economy has recovered handsomely, returning to its pre-COVID GDP... Only private consumption is still below its pre-COVID-19 level,' the eminent economist told PTI in an interview.
While an advanced estimate by the Ministry of Statistics & Programme Implementation (MoSPI) places India's GDP growth in 2021-22, at 9.2 per cent, Panagariya said this is higher than any other country this past year and the recovery has also been across-the-board.
The economy, which was significantly hit by the pandemic, had contracted 7.3 per cent in the last fiscal.
Panagariya noted that the dominant view among epidemiologists now is that with a large proportion of the population now having antibodies due to past infections from different variants of the virus or vaccination, there is now a high chance that the epidemic is about to enter the endemic phase.
'If this indeed comes to pass, I expect the recovery to sustain and the 7 to 8 per cent growth to be restored,' Panagariya said.
Panagariya suggested that the government must now signal its intention to wind down fiscal deficit by cutting it by half-to-one percentage point in 2022-23.
'We should not live beyond our means since it imposes a larger debt burden on the next generation,' Panagariya, who is currently a Professor of Economics at the Columbia University said.
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