The economy needs continued fiscal stimulus to get back on a growth path, says Pronab Sen, chairman of the standing committee on statistics and programme implementation.

Without stimulus the growth rates of 2019-20 cannot be achieved before 2024-25. The economy will see a marginal growth towards the end of 2020-21, driven by pent up demand. However, if the government does not take action this growth will not be sustainable. “There is a hope that by some magic the economy will bounce back and will attain the level it has had in 2019-20 by the end of next year. I am sorry to say that if the government does not do anything, that is not going to happen,” Sen said at a session organised by the Bharat Chamber of Commerce on Wednesday.

Without any additional stimulus from the government, he said, after a 24 per cent contraction in the first quarter, there would be two consequent quarters of contraction followed by a small positive in the fourth quarter and a positive growth in the first quarter of the next fiscal.

“The choice before the government is either you do something now or you get to a situation where your finances will continue to slide and FRBM would be almost impossible to meet,” he said.

He added that when Covid-19 struck India, there was already a negative momentum and capacity utilization had gone down.