Covid-19: Second wave affected momentum, recovery likely from July, says chief economic adviser
KV Subramanian said the lifting of restrictions in states and the vaccination process will lead to recovery.
Chief Economic Adviser KV Subramanian on Thursday said the second wave of the coronavirus pandemic has affected the momentum of the country’s economic recovery, ANI reported. He, however, added that the economy will begin to recover from July and that the pandemic will not have an impact on the country’s fiscal deficit and disinvestment targets for the current financial year.
“States have started removing [coronavirus-induced] restrictions and if we speed up vaccination, our economy will start recovering,” Subramanian said.
The comments came days after government data showed that India’s growth rate for the financial year of 2020-2021 contracted by 7.3% – the sharpest ever decline in the economy. The Gross Domestic Product for the fourth quarter (January to March) grew by 1.6%. A day later, Congress leader and former Finance Minister P Chidambaram said that the previous financial year was the “darkest year of the economy in four decades”.
Subramanian, however, pointed out that the domestic stock markets were trading at record-highs and asserted that it indicated investors believed that the Indian economy would do well.
“The prediction of good economic growth and investment by developed nations in the Indian stock market has led the stock market to a record high,” he said.
He also reiterated the central government’s claim that all adult citizens will be vaccinated against the virus by the end of this year. “If we vaccinate people in three shifts each day, then, we can vaccinate one crore people in a day,” Subramanian said. “This is definitely ambitious, but not impossible.”
Various Union ministers have repeatedly made the claim, though several states face shortages of vaccine doses. The Centre has, however, said that over 200 crore doses of vaccines will be available in the country by the end of 2020. The government has said that a number of vaccines are in the pipeline in different stages of trial and approval.
So far, over 21.97 crore doses of coronavirus vaccines have been administered in the country and more than 4.41 crore beneficiaries have received both the doses, according to government data on Friday evening. Thus, only a little more than 3.1% of the 140 crore population of the country have been fully vaccinated.