THE PINCH OF PRICES

Despite the Centre’s reassurances about the economy’s performance, the optimism of the Indian citizen, hit hard by rising prices and unemployment, has been waning. Managing the economy continues to be the ruling dispensation’s biggest challenge

- M.G. ARUN & SHWWETA PUNJ

The NDA government, under Prime Minister Narendra Modi, which assumed power for a second time in May 2019, has had to face a series of disastrous global headwinds. It started with three bouts of the Covid pandemic that led to widespread loss of life and livelihoods, followed by high inflation and a weak currency after Russia launched its long-drawn invasion of Ukraine earlier this year. The world is now staring at a probable recession, which has added to the uncertainty.

Policymakers could take heart from a recent Bloomberg survey that said that India has zero probability of slipping into recession, unlike other economies, including some parts of Asia, Europe and the US. Finance minister Nirmala Sitharaman, while speaking in Parliament on August 1, affirmed that India's economic fundamentals are looking good and that the country is neither facing a recession nor stagflation (characterised by zero economic growth and high inflation).