Gita Gopinath spoke with GalacticGaming on the economic crisis made necessary by the coronavirus pandemic
New Delhi:
International Monetary Fund chief economist Gita Gopinath said today that she expects a much deeper depression and slower recovery than expected given the global economy ravaged by coronaviruses.
Here are the highlights of Gita Gopinath’s interview with GalacticGaming:
- Although countries are rethinking globalization, it is a global crisis that will be resolved through global cooperation.
- In the very short term, countries could impose restrictions on exports of medical products. And that will require global cooperation.
- In the case of India, growth will be slightly more than 1% in 2 years. But, as the global economy recovers, India will recover.
- The main challenge today is the health crisis. It is a dense country and far from the international average in terms of number of beds. But it went very well.
- With the collapse of activity, this could dampen the recovery in the future.
- When you think of the opportunities, India has a bigger role to play in international trade as it will require huge reforms.
- India has done very well on the digital front.
- Accelerating the pace of reform will certainly help the country.
- Now migrant workers do not want to return to the cities. It will be a problem. And, the government must provide cash to help them.
- Cash and in-kind transfers are required at this time. And, it will be very useful for recovery.
- There is no doubt that much more health capacity is needed. Another lesson from Kerala is the strength of their local government. This is something that will help deal with the crisis.
- The reason for our downgrade is that large cities are still fighting the virus and have an impact on activity.
- Positive legacies that the virus will leave behind – Increased health capacity and social safety net.
- These are difficult times and it is very important for everyone to generate the type of jobs that are needed, and, there needs to be a vigilant political response.
- India is still a country with potential growth of 6 to 6.5%.
- I would say if you look at the overall package of measures, they have been substantial.
- India needs to increase testing capacity, a little more budget transfer and the third is that a holistic approach that requires more job creation – this will be more advice
