Is it time to roll back anti-crisis programme

Font Size

Print

Feedback

Email

Discuss

• Discount UK Shopping

: As the neo-liberal economic model plunged into the worst ever crisis after the great depression of 1930s , governments across the world launched huge anti-crisis programmesrunning into hundreds of billions of dollars as stimulus packages for the economy. Though there are talks about end of the crisis and the beginning of the of economic recovery, the process looks very feeble and unstable . The economic growth rate in Europe and North America is very low and uncertain , inspiring cautious optimism .

Against this back drop, some countries have started talking about rolling back of bail out programmes, triggering debates among economists . Prime Minister Manmohan Singh declared in the India Economic Summit that India would be first among G-20 countries that would gradually withdraw stimulus package for India’s fast-growing economy. Indian government next year would take measures to reduce stimulus programme , declared Prime Minister Dr Manmohan Singh addressing global CEOs and domestic industry leaders at the Summit organised by World Economic Forum and CII Economic Summit.

However his finance minister Pranab Mukherjee speaking in the same forum two days later contradicted him by saying that the government would continue to stimulate domestic demand and will not roll back fiscal sops until robust recovery is visible globally. The finance minister made it clear that that the timing of withdrawal of the fiscal stimulus measures would hinge on a robust recovery of the global economy as till then, state support measures would have to continue to spur domestic demand .

Close on the heels of finance minister’s statement, the finance secretary Ashok Chawla maintained that despite the initial signals of economic recovery, the turnaround in GDP growth was not robust as yet . Besides, getting back to the high growth trajectory of 8-9% can hardly be possible without a rise in the country’s sagging exports and for this, a robust recovery in the global economy is absolutely essential.

While Indian government is expecting global economic recovery to be firmly rooted in 2010, IMF experts have described the recovery of the world economy as ‘unstable’ and ‘incapable of self-sustainability.’