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This unprecedented payment to the Indian government must support the economy in these times of crisis. India is experiencing a worrying slowdown, with economic growth at its lowest point in five years. But it is not even sure that this sum of money is enough to revitalize the 3rd Asian economy.
With our correspondent in New Delhi, Sébastien Farcis
The government of Indian Prime Minister Narendra Modi has managed to force the arm of the central bank after months of resistance. 22 billion euros is three more money than usual. Essential support to face a serious slowdown of the Indian economy. Industrial production, consumption and investment continue to fall, and growth slowed to 5.8% in the first quarter. Or the lowest level in 5 years.
However, this fresh money should not be enough to revive the economy, according to Arun Kumar, an economist at the New Delhi Institute of Social Sciences. " Tax revenues are in deficit of 20 billion euros compared to what was expected, because of this slowdown in growth, says the economist. So this money will be used above all to compensate for this important lack of income. But it will not be enough to launch new investments and curb this economic slowdown. "
Last week, however, the government announced first steps to help the auto industry. The sector, one of the largest employers in the country, saw its sales fall by 12% in one year.