Former RBI Governor and Chancellor of ICFAI Foundation for Higher Education (IFHE) C Rangarajan has said that the hope of economic recovery was high after the first wave but with the second wave, recovery appeared difficult as the spread of virus had adversely impacted several sectors resulting in unemployment and weakening demand.
To handle this situation, the government had to consider increasing expenditure to push demand in the system as a stimulant for the economy, he said, while addressing the two-day 14th Annual Doctoral Thesis Conference organised by the ICFAI Business School, Hyderabad, in collaboration with the Indira Gandhi Institute of Development Research (IGIDR) here on Thursday.
The conference with its focus on the topic ‘Macroeconomics and Finance’ was also addressed by Prof. S. Mahendra Dev, Director and Vice Chancellor of IGIDR and President, Indian Economic Association, who felt that the pandemic had been more severe for India as it had struck at a time when the economy was already slowing down. He said, “While big companies could manage the first wave, the informal sector and MSMEs were impacted adversely. But in the second wave, manufacturing and some industries would also be impacted, especially contact intensive services.” He opined that building capital base and good corporate governance will determine growth after COVID.
