Government, RBI’S prompt policy measures helped reinvigorate economy with minimal damage: Finmin

NEW DELHI: The Finance Ministry on Tuesday cited “green shoots” of recovery in agriculture, manufacturing and services sectors, and said the prompt policy measures taken by the government and RBI have helped reinvigorate the economy with minimal damage. Stating that agricultural sector remains the foundation of the Indian economy, the ministry said that a normal monsoon, as has been forecast, should support the rebooting of economy. “Though the GDP contribution of the sector may not be very large (in relation to industry and services), its growth has a very positive impact on the large population dependent on agriculture.

Further, the recent landmark reforms announced in the sector will go a long way in building efficient value chains and ensuring better returns for farmers,” the ministry said in a statement. Early green shoots of economic revival have also emerged in May and June with real activity indicators like electricity and fuel consumption, inter and intra-state movement of goods, retail financial transactions witnessing pick up, it said, adding India becoming the world’s second largest manufacturer of personal protective equipment (PPE) within two months shows the resilience of the manufacturing sector.

“The Government and the RBI have taken prompt policy measures - both short term and long term - in a calibrated manner to reinvigorate the economy at the earliest with minimal damage .... The commitment of the Government towards both structural reforms and supportive social welfare measures will help build on these ‘green shoots’,” the ministry said. To contain the spread of coronavirus the government had imposed nationwide lockdown from March 25. From June 1, India has started phased resumption of services and businesses. Due to timely tracing, treatment and reporting, the number of people recovering from the virus is continuously rising and the active cases, as on date, are 41 per cent of the total cases in the country.

“The resolve for ‘Atma Nirbhar Bharat’ will be strengthened with the collective effort of all stakeholders and contribute to rebuilding a strong vibrant Indian economy,” it said.

With regard to agriculture sector, the ministry said procurement of wheat from farmers by government agencies has touched an all-time record figure of 382 lakh metric tonne (LMT) on June 16, 2020, surpassing the earlier record of 381.48 LMT achieved during 2012-13. 42 lakh farmers have been benefitted and a total amount of about Rs 73,500 crore has been paid to them towards minimum support price (MSP) for wheat, it said.

As on June 19, farmers have sown 13.13 million hectares of Kharif crops, 39 per cent higher than corresponding period of last year with a big jump in area coverage under oil seeds, course cereals, pulses and cotton. Fertiliser sales have surged by almost 98 per cent year-onyear in May 2020 to 40.02 lakh tonne, reflecting a robust agricultural sector.