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Indian economy likely to contract in range of 5-7.5% in FY21: Arvind Virmani
Jan-18-2021

Former chief economic adviser Arvind Virmani has said that the Indian economy is likely to contract in the range of 5-7.5 per cent this fiscal (FY21) but will see a growth of 9 to 11 per cent in FY 2021-22. Further, Virmani said in the upcoming Budget, the government should come up with policies to accelerate India's economic growth.

Besides, he said that India can't become 'Aatmanirbhar' with the 20th century Direct Tax Code (DTC). He mentioned ‘There is a need to simplify direct taxes and indirect taxes for MSMEs. We can't have 21st century Aatmanirbhar with 20th century DTC... We need 21st century Direct Tax Code.’ He also emphasised that there is a need of 15 per cent uniform GST rate for 75 per cent of goods and services. Noting that production-linked incentive (PLI) was actually a very good scheme, Virmani said the government should promote employment generating exports.

He also pointed out that free trade agreements (FTAs) with the US, European Union (EU) and the UK are much important than with the Regional Comprehensive Economic Partnership (RCEP) because most MNCs are located in the US, EU and the UK. He also suggested that the government should spend more on infrastructure projects, modernise sewage system to deal with the future pandemic and invest on R&D on contagious diseases.

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