New Delhi: Emphasising on the importance of government relief or support in the given scenario, he pointed out that it is “meagre” so far.
In a note published on LinkedIn, he also opined that the 23.9 per cent contraction in the GDP during the Q1 would be “even worse if the damage to the informal sector is taken into account”.
“The recently released quarterly GDP growth numbers for the first quarter of FY2020-21 should alarm us all. The 23.9 per cent contraction in India (and the numbers will probably be worse when we get estimates of the damage in the informal sector) compares with a drop of 12.4 per cent in Italy and 9.5 per cent in the United States, two of the most Covid-affected advanced countries,” Rajan said.
He said that India is “even worse off” than these comparisons suggest.
Since the coronavirus pandemic is still raging in India, discretionary spending, especially on high-contact services like restaurants, and associated employment, will stay low until the virus is contained, Rajan said, adding that government relief becomes all the more important in the given scenario.
