Washington: The International Monetary Fund on Wednesday said as the Indian economy recovers from the COVID-19 pandemic that has hit it hard, it is important for the country to focus on public investment, especially in green zones.
“As we move towards recovery, it is also important to focus on public investment, especially green investment, so that the recovery is inclusive,” Paolo Mauro, deputy director of the IMF’s Department of Financial Affairs, told reporters during a news conference here. and be green.”
He said India’s debt ratio stands at around 90 per cent, and it is important to point out that there is a medium-term fiscal framework that ensures investors that the debt ratio will decline in the medium term. Responding to a question, Mauro said the situation is improving when it comes to the pandemic.
This is very different from a few months ago, he said, adding that fortunately, the number of cases is declining and vaccination is becoming more widespread. Therefore, on the economic front, even though the situation is improving, addressing the health emergency remains a priority. Mauro said that it remains to provide adequate support especially to the poor section of the population through social security, employment benefits etc.
In the context of recent reforms, one that I would like to highlight is the National Asset Reconstruction Company, the so-called Bad Bank. This is potentially very promising as it is important to tackle non-performing loans, he said. He said it has been a long drag on credits, and is potentially very promising.
Mauro said it is vital that such so-called bad banks have both governance and independence in place so that the cost of public finance can be kept under control and inclusive growth is promoted.