Mains Paper 3: Economy
Prelims level: Conservative approach
Mains level: Government’s conservative approach towards addressing economic
Over the past week, Finance Minister Nirmala Sitharaman unveiled a
series of measures to help ease the stress in different sectors of the
economy across the country.
But the announcements have failed to reassure or enthuse, pointing to a
chasm between expectations and reality.
The actual fiscal outgo is likely to be around only 1 per cent of GDP,
far short of the proclaimed 10 per cent. The government’s conservative
approach seems to be driven by several factors.
First, as there continues to be uncertainty over how long it will take
for the pandemic to be brought under control, and how economic activity will
shape up over the coming weeks and months, it is difficult at this juncture
to make a reasonably accurate assessment about the state of the economy, and
thus arrive at an estimate of the breadth and depth of the government
intervention that is needed.
As Sitharaman said in an interview to this paper, “It’s too early for me
to make an, it’s too early for me to even hazard a guess”. There appears to
be an inclination, then, to keep the power dry for now.
There also appears to be a strong desire on the part of the government
to avoid the mistakes made in the aftermath of the global crisis of 2008.
The consequences of continuing with the s..................................
It is true that the extent of uncertainty is unprecedented. But
revisiting the budget revenue and expenditure numbers only at the time of
presenting the revised estimates might not be a prudent approach.
Instead, the government should present a short-to-medium term fiscal
roadmap that provides a realistic assessment of the state of the economy.
It should clearly lay out how it intends to support the economy during
this period, its expenditure priorities, as well as a clear plan for funding
Q1. With reference to the International Day of Families 2020,
consider the following statements: 1. The International Day of Families 2020 is being observed on 15th of May
with the theme “Families in Development: Copenhagen & Beijing+25”.
2. The Beijing Declaration was adopted to promulgate a set of principles
concerning the equality of men and women.
Which of the statements given above is/are correct? (a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2