Economy needs more hand-holding, fiscal correction can wait: Goldman Sachs
Financial Express Mumbai|January 29, 2022
WARNING THAT ANY sudden and sharp fiscal consolidation steps can throttle the nascent and uneven recovery of the Indian economy, a Wall Street brokerage has said the Budget should instead focus on boosting overall demand, from rural consumption in particular, and invest more in infrastructure.

The successive waves of the pandemic has made it more difficult to reduce government debt as a share of GDP in the medium-term, said Goldman Sachs in a pre-Budget note.

It thus penciled in a gradual fiscal consolidation with FY23 falling by 50 basis points to 6.3% from 6.8% in FY22 and set a target of bringing it down to 4.5% by FY26.

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