RBI challenges IMF’s call for larger fiscal consolidation
Study argues bigger budget cuts not necessary if government focuses on development spending
Officials from India’s central bank have rejected a call by the International Monetary Fund (IMF) for the government to make significant cuts to the national budget.
The six economists, including the deputy governor of the Reserve Bank of India (RBI) Michael Patra, ran their own simulations of the country’s fiscal outlook.
In a paper published in the latest RBI bulletin on February 20, the officials argue that the government can reduce India’s debt-to-GDP ratio by “recalibrating” public
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