RBI issues warning on economic crisis, Rahul Gandhi says 'Increase spending, not credit'

Congress leader Rahul Gandhi on Wednesday took a dig at the centre after Reserve Bank of India (RBI) issued a warning with regards to economic contraction till September amid global pandemic COVID-19. Wayanad MP said, "distractions through media will not help the poor". Rahul Gandhi took to Twitter with this news and posted "RBI has now confirmed what I have been warning for months." Congress leader also shared a few suggestions to battle the situation. 

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Rahul Gandhi gives suggestions after RBI announces economic contraction

After RBI officially issued the warning on declining economic condition amid novel pandemic Coronavirus, the congress leader also shared few suggestions/ recommendations to the government including. He added, "Government needs to: Spend more, not lend more. Give money to the poor, not tax cuts to industrialists. Restart economy by consumption." "Distractions through media won't help the poor or make the economic disaster disappear."

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Diminishing capacity utilization, exhausting of consumption demand and stressed balance sheets, RBI on August 25 called for various changes to recover losses dues to Coronavirus crisis and trace the path back to sustainable economic growth. Wayanad MP said that rather than using the corporate tax cut of September 2019 for reviving the capital expenditure cycle, it has been availed in debt servicing, maintenance of cash balances and present assets. 

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The 2019-20 annual report of Central Bank says, "These underlying developments suggest that the appetite for investment is anaemic and in need of more reforms." The supply of notes has also been affected due to the outbreak of virus informed the Central Bank. The RBI said that the only way to battle COVID-19 economic crisis into an opportunity is by using training and online provision of education to execute reforms in the social infrastructure by reskilling and skill development to prepare the labour force equipped to keep up with big push on infrastructure. 

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(With ANI inputs)