Perspectives on Business Management, Economics & Information Technology (PBMEIT) Now also covers research on Psychology

PBME Volume III ISBN: 978-81-951151-1-2

CONVERGENCE OF FISCAL AND MONETARY POLICY FOR V-SHAPE RECOVERY OF THE INDIAN ECONOMY

Author(s): DR. GEETANJALI SHARMA

Abstract

The dark clouds of recent pandemic are hovering around the entire world. It has necessitated the urgent need for upgraded and prepared medical facilities especially for the developing countries like India. On social and economic front, the impact is equally catastrophic creating sense of uncertainty and ambiguity in the minds of consumers, business and investors as well as the government. The present scenario calls for extensive reforms and changes in order to revive the overall sentiment’s and bring the Indian economy on track. This paper highlight’s the importance of mutually reinforcing fiscal and monetary policy reforms for V-shaped recovery of the economy. India needs to unleash the same animal spirit which was demonstrated in the post-1991 liberalization. Structural reforms together with the right channelizing of capital in critical sectors is the need of the hour. Fiscal policy is an instrument of economic development and aims at accelerating the rate of development through direct controls or pushing for structural reforms. Monetary policy aims at facilitating economic growth through suitable interest rate policies thereby infusing capital in the strategic sectors of the economy.

Keywords: economic reforms, v shaped recovery, structural reforms, fiscal policy, monetary policy

JEL Classification: E52, E62

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