Gita Gopinath spoke to NDTV on the economic crisis necessitated by the coronavirus pandemic

New Delhi:

The International Monetary Fund chief economist Gita Gopinath today said that they are projecting a significantly deeper depression and slower recovery than anticipated in view of the coronavirus-ravaged world economy.

Here are the highlights of Gita Gopinath’s interview with NDTV:

• While countries might be rethinking globalisation but this is a global crisis and will be solved with global cooperation.
• In the very near term, countries may be putting restrictions on medical exports. And, this will require global cooperation.
• In case of India, growth will be slightly over 1% in 2 years. But, as the global economy recovers, India will recover.
• The main challenge right now is the health crisis. It is a dense country and far from the international average in terms of number of beds. But, it has done really well.
• With the collapse in activity, this could dampen the recovery going forward.
• When you think of opportunities is India to be have a bigger role in international trade because that will require huge reforms.
• India has done very well in the digital front.
• Accelerating the pace of reforms will definitely help the country.
• Now, the migrant workers do not want to come back to the cities. This will be a problem. And, government needs to extend cash in hand to help them.
• Both cash transfers and in-kind transfers are required at this time. And, that will be very helpful for the recovery.
• There’s no doubt that much more health capacity is needed. Another lesson from Kerala to learn is the strength of their local government. This is something which will help in dealing with the crisis.
• The reason for our downgrade is that major cities are still battling the virus and impacting the activity.
• Positive legacies that the virus will left behind – Increasing the health capacity and social security net.
• These are difficult times and it is very important for everybody to generate the kind of jobs that are needed, And, it needs a vigilant policy response.
• India is still a country with potential growth of 6-6.5%.
• I would say if you look at the aggregate set of measures, they have been substantial.
• India needs to increase the testing capacity, some more budget transfer and the third is that a holistic approach that requires more job creation  – this will be more advice