Macroeconomic challenges revisited

Policies are moving in the right direction, but vulnerabilities remain

Four months ago, I wrote that India’s macroeconomic challenges deepened (Business Standard, April 14) as inflation rose sharply in the US and European countries, triggering tighter monetary policies, China’s lockdowns to combat the spreading Covid infections damaged economic activity, and the Ukraine war, then seven-weeks old, spawned unprecedented economic sanctions against Russia, leading to soaring prices for oil, gas, wheat and other commodities and to significant disruptions of supply chains. I went on to outline some macroeconomic consequences for India, including likely outturns in key macroeconomic indicators in fiscal 2022-23, and listed some desirable policy responses by the government and