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IMF hails India's 'swift and substantial' response to COVID-19 crisis

The IMF in its report based on "consultations" among members, however, sounded a note of caution saying that the economic outlook remains "clouded" due to pandemic-related uncertainties, contributing to both downside and upside risks.

October 16, 2021 / 01:17 PM IST
A healthcare worker collects a swab for a rapid antigen test from a farmer in his field, during a door-to-door vaccination drive amid the ongoing COVID-19 outbreak in Banaskantha district in the western state of Gujarat. (Representative image: Reuters)

A healthcare worker collects a swab for a rapid antigen test from a farmer in his field, during a door-to-door vaccination drive amid the ongoing COVID-19 outbreak in Banaskantha district in the western state of Gujarat. (Representative image: Reuters)


Describing the Indian government's response to the COVID-19 situation as "swift and substantial", the International Monetary Fund (IMF) has said the country continued with labour reforms and privatisation despite the pandemic.


The IMF in its report based on "consultations" among members, however, sounded a note of caution saying that the economic outlook remains "clouded" due to pandemic-related uncertainties, contributing to both downside and upside risks.


In its "Article IV" consultations report, it further said that a persistent negative impact of COVID-19 on investment and other growth drivers could prolong the economic recovery.


On the Indian government's handling of the pandemic, the multilateral agency said it was "swift and substantial...has included fiscal support, including scaled-up support to vulnerable groups, monetary policy easing, liquidity provision, and accommodative financial sector and regulatory policies".


"Despite the pandemic, the authorities have continued to introduce structural reforms, including labour reforms and a privatisation plan," the report said.

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COVID-19 Vaccine

Frequently Asked Questions

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How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

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The IMF has projected India's economic growth at 9.5 per cent in FY2021-22 and 8.5 per cent in 2022-23. Headline inflation is projected at 5.6 per cent in 2021-22, amid elevated price pressures.


"The economic outlook remains clouded due to pandemic-related uncertainties contributing to both downside and upside risks. A persistent negative impact of COVID-19 on investment, human capital, and other growth drivers could prolong the recovery and impact medium-term growth," the IMF said.


It further said that while India benefits from favourable demographics, disruption to access to education and training due to the pandemic could weigh on improvements in human capital.


At the same time, the recovery could also be faster than expected, it said adding that faster vaccination and better therapeutics could help contain the spread and limit the impact of the pandemic.


In addition, successful implementation of the announced wide-ranging structural reforms could increase India's growth potential, the IMF noted.

Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year.

PTI
first published: Oct 16, 2021 01:18 pm

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