With the release date of the 2021 Budget soon approaching, Prime Minister Modi will be holding a virtual meeting with leading economists and sectoral experts today to seek their inputs on various provisions that could be included in the forthcoming budget to boost economic growth in the country. The discussions will be significant for the revival of the economy which has been badly hit due to the coronavirus pandemic.
The economy had witnessed a sharp downturn in the first quarter with a 23.9 percent contraction in the GDP due to the shutting down of various businesses amid pandemic. However, India has been on its way to recovery ever since June with the gradual reopening of various sectors of the economy including manufacturing. The contraction of GDP in the July-September quarter was 7.5 percent, showing a sharp recovery when compared to the contraction in the first quarter.
However, considering that the estimated contraction of real GDP in 2020-21 is projected at 7.5 percent by the Reserve Bank of India with worse contraction rates predicted by World Bank and IMF for Indian GDP, there still remains a lot that needs to be done in order to turn the negative percentage to positive growth. As per the analysts, the speed of economic revival will depend on how the government plans to spend on various sectors, including the ones hit by the lockdown.
While the Finance Minister, Nirmala Sitharaman, who is set to present the budget on February 1, is already done with the pre-consultations for the upcoming budget, the meeting between PM Modi and experts will take place today. The meeting will be hosted by the government think tank NITI Aayog in the presence of both its Vice Chairman and CEO.