The government should now move towards boosting the white economy since it has already put too much focus on fighting black money, said former chief economic advisor in the finance ministry Arvind Virmani.
The government should now move towards boosting the white economy since it has already put too much focus on fighting black money, former chief economic advisor in the finance ministry Arvind Virmani told ET Now on Friday. It comes at a time when the economy is seeing a slowdown, owing to both domestic and global factors. The Modi government has taken a slew of measures, over the years, to fight black money including Black Money (Undisclosed Foreign Income and Assets), Imposition of Tax Act, 2015, demonetisation, amended Benami Transactions (Prohibition) Act and amended Double Taxation Avoidance Agreement (DTAA) with Mauritius.
Adding, Arvind Virmani said that Q2 GDP growth could be in the range of 4-4.5 per cent. In the first quarter of the ongoing fiscal, the economy printed a dismal growth rate of 5 per cent. The government will release Q2FY20 GDP data later in the day today. Several agencies have predicted that the growth may slump further in the second quarter below 5 per cent. The last time India’s growth rate fell below 5 per cent was in Q2 FY13.
On way to revive growth, Arvind Virmani said that the monetary policy needs to be loosened further to the growth to rebound going ahead. The Reserve Bank of India’s (RBI) monetary policy committee (MPC) is scheduled to meet between December 3 and December 5 to review the interest rates. The repo rate was cut for the fourth straight time in the year by the MPC. The central bank is expected to look through the recent breach of its 4 per cent medium-term inflation target and deliver another rate cut on December 5. Arvind Virmani also said that he doesn’t expect a fall in private consumption expenditure.