Another recession unlikely

CHENNAI: There is no chance of another recession descending on India and there is no need to panic because of the falling Rupee. At least the PM’s advisor thinks so. “The possibility of developed economies around the world slipping into another recession is very small... I do not believe it is going to happen,” C Rangarajan, Chairman of Prime Minister’s Economic Advisory Council, said on Friday.Speaking to reporters on the sidelines of the Annual Day at the Madras School of Economics, ex-RBI governor went to justify his statement saying that while the growth rate in developed countries might “slow down”, the possibility that it will see a negative rate is very remote. “Even when the growth rate slows down, it will impact developing countries like India only in terms of trade flow,” he added. Commenting on the efforts being taken in West to ensure that another recession does not happen, he said, “It is clear that the economies in the developed world are not moving as fast as expected, which is why there have been efforts in the US to revive it.” He also claimed that the gradual decline of the Rupee is not something to panic about, when looked at in relation to other currencies. “It is a reflection of what has happened in emerging economies in the rest of the world,” he said. “The currencies in many other economies have fallen. There is some panic, but we must remember Rupee stayed strong for quite a number of years, before the decline began.”