Five things that Raghuram Rajan believes can help India counter its recent dip in GDP

• Former RBI governor Raghu Rajan believes that India’s latest edition of GDP data is only going to worsen once the impact of the pandemic on the informal sector is accounted for.
• He warns that the longer the remedial measures aren’t implemented, the harder it will be to recover.
• In order for the Indian economy to recuperate some of its losses and sustain growth, here are five things that Rajan recommends the government of India should do.

The former governor of the Reserve Bank of India (RBI) Raghuram Rajan believes that India’s latest GDP data should ‘alarm us all’. According to him, the numbers are likely to look worse when the estimates of the damage to the informal sector roll in.

“The pandemic is still raging in India, so discretionary spending, especially on high-contact services like restaurants, and the associated employment, will stay low until the virus is contained. Government-provided relief becomes all the more important,” he wrote in a post shared on LinkedIn, pitching for an economic stimulus as soon as possible.

“So government officials who hold out the possibility of a stimulus when India finally contains the virus are underestimating the damage from a more shrunken and scarred economy at that point,” he pointed out.

Here are five things that Raghuram Rajan believes that the Government of India can do to reduce the coronavirus pandemic’s impact on the economy: