World Bank president David Malpass has named India among the three nations — the others being the US and China — which are setting the pace for faster global growth on the back of strong rebounds. This is an acknowledgment of India’s encouraging economic recovery, even as the country is battling the second wave of the pandemic. Citing the revival of private consumption and investment, the World Bank recently scaled up its projections for India’s GDP growth to 10.1 per cent for 2021-22, considerably up from 5.4 per cent that it had forecast in its January report. However, the international financial institution hastened to add that in view of the uncertainty caused by the resurgence of Covid cases in the country, the real GDP growth for this financial year could range from 7.5 to 12.5 per cent. Malpass has made it clear that faster approval and rollout of vaccines are vital for safeguarding national as well as global interests.
The biggest challenge for India is to intensify the vaccination campaign and at the same time ensure that the restrictions that hamper economic activity are kept to a minimum and done away with once the situation improves. Already, the stringent curbs imposed by some states have started disrupting businesses, taking a toll on inter-state as well as intra-state movement. The lockdowns of 2020 demonstrated bitterly that preventing millions of people from plying their trade was a self-defeating exercise with far-reaching ramifications. The focus should be on enforcing compliance with Covid safety protocols rather than forcing business establishments to suspend or scale down operations.
According to the International Monetary Fund, India’s debt-to-GDP ratio rose from 74 per cent to 90 per cent during the pandemic, but it is expected to drop to 80 per cent gradually. This is another validation of the country’s fightback on the economic front. With the worldwide debt-to-GDP ratio nearing 100 per cent, India must consolidate its position with judicious moves and vindicate the confidence reposed in it by global financial bodies.