Jaitly to reevaluate fiscal policy |
Emphasising the need for globally coordinated policy decisions to remedy the global economic turbulence, Indian Finance Minister Arun Jaitley April 15 said that the time is ripe for a reevaluation of the fiscal policy space.Apparently, the efficacy of monetary policy instruments has reached its limits and that its pass through has not been seamless. The time is ripe for a reevaluation of the fiscal policy space, with a greater focus placed on public investment. Jaitley said at the G-20 Finance Ministers and Central Bank Governors meeting on `Global Economy and Framework for Strong, Sustainable and Balanced Growth`.He noted that the key downside risks which could derail the fragile global recovery are - weak demand, tighter financial markets, softening trade and volatile capital flows. Noting that declines in both imports and exports were recorded in all G20 economies in 2015, Jaitley also stressed the need to articulate an effective and tangible policy response to revive the trade engine of the global economy.Countries must avoid trade protectionist measures, and refrain from competitive devaluations, he said. He expects this momentum to continue, assuming a normal monsoon.
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