Economic impact of the 2nd wave of Covid likely to be mitigated: finance …


(MENAFN – Kashmir Observer)
New Delhi- The finance ministry said on Tuesday that the economic impact of the second wave of the COVID-19 pandemic would likely be mitigated and that there were visible signs of economic rejuvenation. The latest Monthly Economic Review, published by the Ministry of Finance, stated that “the strong recovery in tax collections is cushioning the tax authorities towards achieving budgeted support for the economy”.

He also said the recent seroprevalence results mean India may reduce the likelihood of serious illness from COVID-19 if the country maintains the momentum of the vaccination program. “Having the antibodies reduces the likelihood of contracting serious illnesses, as studies show. So any subsequent wave should be benign in terms of the severity of the illness,” the ministry said in the report.

However, it is imperative that proper behavior and protocol be followed. At this point, he said, the economy and society are at a critical inflection point where sustaining the economic recovery, advancements in vaccination and appropriate behavioral strategies for COVID-19 are needed. in close synergy with each other.

With the decline of the second wave in most parts of the country and the gradual lifting of restrictions by state governments, there are visible signs of economic rejuvenation since the second half of May, he said. “This resonates with the economic impact of the second wave which should be mitigated,” the report added.

Noting that inflation has remained above the six percent range in May and June, the report says these pressures are expected to ease over the next few months, with restrictions easing, the monsoon increasing. southwest and recent supply-side policy interventions in the pulse and oilseed market.

He said that while systemic liquidity remained in excess in July, a decline in the growth of cash in circulation reflected an abandonment of precautionary savings induced by the pandemic. Financial markets were buoyant during the month, with a recovery from the second wave seen in mutual fund, corporate bond and insurance markets, and equity market volatility continuing its downward trajectory. .

However, the G-sec yield curve steepened slightly due to inflationary pressures, he said. The ministry added that bank credit growth was showing encouraging trends with non-food credit growth breaking through the 6.5 percent mark in the fortnight ended July 16 after remaining subdued for nine fortnights.

On the sectoral level, the withdrawals of credit by agriculture and related activities, micro, small and medium industries recorded accelerated growth in June, demonstrating the positive effects of the implementation of the Aatmanirbhar Bharat package.

Central government finances showed an improvement in performance in the June 2021 quarter compared to the previous year period. This is explained by the dynamism of direct and indirect tax collections, the continued focus on capital spending with a growth of 26.30% during the quarter and the redefinition of the priorities of revenue spending, a- he declared.

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