“On the economic front, even though the situation is improving, addressing the health emergency remains a priority,” said the deputy director of the IMF’s Department of Financial Affairs.
The International Monetary Fund on Wednesday said as the Indian economy recovers from the COVID-19 pandemic that has hit it hard, it is important for the country to focus on public investment, especially in green zones.
“As we move towards recovery, it is also important to focus on public investment, especially on green investments, so that the recovery be inclusive and green.”
He said India’s debt ratio stands at around 90 per cent, and it is important to point out that there is a medium-term fiscal framework that ensures investors that the debt ratio will decline in the medium term.
Responding to a question, Mr Mauro said the situation was improving when it came to the pandemic.
This is very different from a few months ago, he said, adding that fortunately, the number of cases is declining and vaccination is becoming more widespread.
“On the economic front, even though the situation is improving, the priority remains to address the health emergency. It remains to provide adequate support especially to the poorer sections of the population through social security, employment benefits, etc.,” said Mr. Mauro.
“In terms of more recent reforms, one that I would like to highlight is the National Asset Reconstruction Company, the so-called Bad Bank. This is potentially very promising as tackling non-performing loans is critical,” he said.
He said it has been a long drag on credits, and is potentially very promising.
“It is very important that such so-called bad banks have both the governance and independence in place to keep the cost of public finance under control and promote inclusive growth,” Mr Mauro said.
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