Not Much Space for Fiscal Stimulus in India, Says Scotiabank’s McCully

The video discusses the recent budget measures and the economic challenges faced by India, highlighting the need for fiscal stimulus amidst weak public finances. It covers the Reserve Bank of India's decision to keep interest rates unchanged due to rising inflation and the limited policy transmission in the country. The discussion also touches on India's debt issues, particularly non-performing loans, and the government's role in economic missteps. The need for structural reforms to boost long-term economic growth is emphasized.

What is the main challenge the government faces in implementing fiscal stimulus?

• High public debt

• Weak public finances

• Strong economic growth

• Excessive foreign investment

Why is the Reserve Bank of India expected to keep interest rates unchanged?

• To support the stock market

• To encourage more borrowing

• Because of a significant rise in inflation

• Due to a decrease in inflation

How does India's level of non-performing loans compare to China's?

• India has fewer non-performing loans than China

• India has more non-performing loans than China

• India and China have the same level of non-performing loans

• Non-performing loans are not a concern in India

What is a significant issue with policy transmission in India?

• It is not influenced by interest rates

• It is too rapid

• It is limited and inadequate

• It is highly effective

What is necessary for boosting the Indian economy in the long term?

• Higher interest rates

• Short-term fiscal measures

• Structural reforms

• Increased foreign loans