Farm Loan Waivers won’t solve Agrarian Crisis Permanently: IMF Chief Economist

Chief Economist of International Monetary Fund (IMF), Gita Gopinath said that rise in trade tensions and worsening of financial conditions are two major risks facing the global economy. She said this minutes’ after the IMF on 21st January cut its world economic growth forecasts for the year 2019 and 2020.

Gopinath talked about a host of issues right from the state of US economy, worldwide financial health, uncertainties around Brexit and also Chinese growth figures. She said that the new Chinese growth figures are steady with IMF forecast.

Regarding the farm loan waivers in India, Gopinath said that loan waivers will not solve this issue permanently but the direct cash transfers may be helpful for the farming community.

Taking about Brexit and the uncertainties around it, the IMF chief economist said, "We have already seen the negative outcome of this uncertainty on the British investment hence it is very important to resolve the issue as early as possible”.

On the Indian economy Gopinath said, India remains one of the fastest growing major economies in the world. She hailed policy initiatives such as Goods and Service tax, Insolvency and Bankruptcy code and ease of doing business.  She also highlighted the risks related with country’s “high” fiscal deficit while declining to comment on exact government policies.

Over 3,000 global leaders from business, politics, government, civil society, arts and media will attend The World Economic Forum 2019.

Indian Finance Minister, Shri Arun Jaitley is likely to attend a session on emerging markets outlook, where the deliberations would be on whether policy makers are equipped to prevent a hard economic landing with highly-leveraged rising market economies feeling the pinch from growing protectionism and tightening economic conditions in the US.

Microsoft's Indian-origin CEO, Satya Nadella and World Bank President, Jim Yong Kim will be among the co-chairs of the 2019 edition of this annual gathering of world leaders from 21^st to 25^th January.