Column : Abe’s comeback bodes well for India
Shinzo Abe, who gets sworn in today as the Prime Minister after a gap of over five years, has won a landslide victory primarily on the back of promising a rapid economic recovery. He and his party has talked of ‘unlimited monetary easing’, ‘large scale’ fiscal stimulus and ‘doubling’ the inflation rate. For considerable time now, Japan has been suffering from economic contraction, low grade deflation and a soaring currency which has squeezed its exports. Responding to the signals of the incoming government, the conservative Bank of Japan Governor has already vowed to significantly expand asset-purchases and pump in more money into the economy. Such measures with, no doubt, further pressurise the huge public debt of Japan but the LDP and its leadership consider these essential to lift the GDP growth to 3% per annum, raise inflation target to 2% and bring down the yen by some 20% against the major global currencies.
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