The central bank is sure that the second wave of Covid has not caused as much damage to the economy as it was feared. But the bank sector is not alone responsible to bring the economy on track. This is the reason why RBI Governor Dr. Shaktikanta Das has stressed the need to take big steps at the government level to bring the economy in the right direction after the second wave of Covid.
Presiding over the recent meeting of the Monetary Policy Committee (MPC), Das has said that steps will have to be taken at every level, fiscal, monetary and sectoral, to give impetus to the economy. All six members of the MPC, including the governor, have supported keeping interest rates stable for the time being. But the committee has also assured that in view of the situation going forward, efforts will be made to keep the interest rate at a lower level.
The RBI Governor has clearly said that after the second wave of Covid, there is a need to take comprehensive monetary measures to bring the economy back on track. At the same time, there should also be a system that the inflation situation should also be within the target (2 to 6 percent) in the coming days. He has described the condition of the agriculture sector as very satisfactory and said that its contribution will be very important in strengthening the economy even during the current financial year.
All five members of the MPC have said that there is uncertainty about the pace of the economy after the second wave of Covid. But it is also a sign that the situation is not as bad as last year. Everyone has expressed concern about the rising signals on the inflation front and declining demand in rural and semi-urban areas. Everyone also believes that the situation ahead will be clear only with the speed of vaccination. The central bank has said the same thing a day ago in another report released on the state of the economy.