The struggle for stability

In the absence of any systemic or meticulous approach to tackling deep-seated woes, the overall economic outlook appears to be blurred or bleak. But the firefighting mode is helping to superficially ease pressures on the external sector, possibly for a brief spell, while curbing domestic demand of imported goods/services amidst sliding GDP growth. However, the risk of foreign debt default is still a hot topic in the national discourse, with falling forex reserves and the dollar gaining value against the rupee. Initiatives such as diversifying sources of raising domestic finances for investment in prioritised productive sectors and encouraging capital spending on the energy sector to eliminate foreign crutches will take a bit longer. However, these steps will not be enough for the turnaround of the economy and sustained and inclusive growth. The central bank has decided to update its primary dealers’ system to create more capital market functionaries in the primary market of government securities. It says this will cater to the needs of a diverse group of investors and attract a new clientele to the government securities market.