REVIVING THE ‘ANIMAL SPIRITS’

Bringing back private investment—a key pillar of the economy—is imperative to make India’s recovery from the pandemic sustainable

THE ISSUES ➘ GLOBAL UNCERTAINTY

caused by Russia’s invasion of Ukraine in late February first led to commodity prices peaking, then to the threat of an impending recession

➘ ALTHOUGH URBAN

demand improved as contact intensive services restarted, unemployment, insecurity on the job front and subdued demand from the rural areas are still concerns

➘ THREAT OF INFLATION

continues, with August showing retail inflation remaining sticky at 7 per cent despite a series of interest rate hikes by the RBI. Higher interest rates also dampen investment

➘ CAPACITY UTILISATION

dropped to less than 50 per cent during the worst period of the pandemic. Although this has picked up to 70 per cent, it needs to improve to around 80 per cent