Green shoots
Amid a worldwide economic slowdown triggered primarily by the Russia-Ukraine war, the International Monetary Fund (IMF) has observed that India is ‘doing better and is in a relatively bright spot compared to other countries in the region’. According to the IMF, more than one-third of the global economy will contract next year; the three largest economies — the US, the European Union and China — will continue to struggle. In its World Economic Outlook, the IMF has projected India’s pared-down growth rates of 6.8 per cent and 6.1 per cent for 2022 and 2023, respectively, as compared to 8.7 per cent in 2021. The world body’s corresponding figures for China for this year and the next one are 3.2 per cent and 4.4 per cent, taking into account the crippling impact of the series of lockdowns imposed under the country’s harsh zero-Covid policy.
A far better economic forecast compared to China is good news for India, which has shown resilience in coping with the upheaval caused by the pandemic and the war in eastern Europe. There is another heartening development: India’s unemployment rate plummeted to 6.43 per cent in September due to an increase in labour participation in rural and urban areas, as per data released by the Centre for Monitoring Indian Economy. This figure had shot up to an 11-month high of 8.3 per cent in August. The challenge now is to keep the unemployment rate low and focus on large-scale job generation. Crores of jobs lost due to the Covid lockdown and other disruptions need to be restored on priority.
A World Bank (WB) study has found that Covid-19 dealt the biggest setback to global poverty-reduction efforts since 1990 and the war in Ukraine is threatening to make matters worse. The WB has estimated that the number of poor people increased worldwide by over 7 crore in 2020, including at least one-third in India. The country’s commendable economic resurgence will remain a job half done unless dedicated and sustained efforts are made to pull millions of destitute citizens out of poverty. Inclusive economic growth requires reaching out to the poorest of the poor.
