GST collection, power consumption show recovery: Ex-RBI chief C Rangarajan

Chennai: Former legislative leader of the Reserve Bank of India (RBI) C Rangarajan on Thursday said the decrease in the development of the economy set off by COVID-19 resembled a state of unconsciousness that stays for a brief period. Rangarajan, likewise the previous Prime Minister’s Economic Advisory Council executive, said this during ‘SICCI-360’ sorted out here by the Southern India Chamber of Commerce and Industry.

“(Normally) Coma lasts for several years (in medical terms). But there are people who come out of it in a shorter period. This is a coma which is short-lived. The point is as you (gradually) lift the lockdown, I expect the economic activity to pick up,” he said.

“There are indications or news24nations of the economy picking up — collection of GST (goods and services tax) and consumption of electricity,” he said to an inquiry from a member. As per the Finance Ministry, the GST gathered in October rose to Rs 1.05 lakh crore, crossing the Rs one-lakh-crore mark unexpectedly since February this year, mirroring a get in the monetary movement.

The incomes for the month were 10 percent higher than Rs 95,390 crore gathered in the exact month a year ago.

Expounding on this, Rangarajan stated, “Beginning September till March, there could be a pick-up in economic activity. But it will not be adequate to compensate for the loss that happened in the first half of the financial year.” If there is no second influx of COVID-19, 2021- 22 can see a get and before the finish of FY 2021- 22, there will be further getting (of the economy), he said. Taking note of that the development rate was nine percent for three successive years among 2000 and 2010, he stated, “Unfortunately, it later fell and further declined. We need a fast-growing economy and that requires not only measures not only from the government but also from the private sector.”

To an inquiry on the debilitating of the rupee against the US dollar, he said swelling ought to be managed as outer estimation of the cash was controlled by its inside worth. “Fall in value of rupee in terms of the dollar is essentially a demand for goods from the United States, which was stronger compared to Indian goods. Indian goods should be competitive,” he said. “The fact of the matter is the external value of currency is essentially determined by the internal value of the currency. That is what economists were saying. In western economies, the inflation has been very much under control. But our inflation rate has been much higher and it has ultimately contributed to the reduction in value of rupee,” he said.

Rangarajan likewise advised that decrease in expansion rate would likewise affect the nation’s monetary development. “The attempt to reduce inflation rates will have an adverse impact on growth. Some people think that we can sacrifice price stability to some extent for a higher rate of growth. But that is an argument that is going on. I may have a view but some other economists might offer a different view,” he said.