Manmohan Singh lists 3 important steps to revive economy amid COVID-19August 12, 2020 19:10
(Image source from: newindianexpress.com)
Manmohan Singh had an email interaction with BBC during which he told that the economic slowdown in the country is a humanitarian crisis.
While stressing that a deep and prolonged economic slowdown is inevitable due to the current challenging times, the former Prime Minister had spoken about the three main steps to bring back the economy to the right track. He also hoped that the Narendra Modi government would follow his steps for a better economic future of the country.
He said to the BBC that the government's shock and awe approach towards the lockdown has created severe pain in people. However, he said that lockdown at that stage is an unave choice.
According to Singh, the government must ensure that people's livelihoods are protected and they must be given the spending power through significant Direct cash assistance.
He mentioned that the Centre must also make adequate capital available for the businesses through government backed credit back guarantee programmes.
Manmohan Singh also asserted that the government should fix the finance sector through institutional authority and processes.
Talking about Direct cash transfers he said that though high borrowing is inevitable it would increase India's debt to GDP ratio. However, if borrowing can save lives, borders, restore livelihoods and boost economic growth then it is worth it.
He quoted that the government must not be shy of borrowing but must be careful about how it is spending the borrowings.
Dr. Singh also warned against India following some other nations in becoming more protectionist by imposing high trade barriers duties on imports.
He said that India's trade policy over the last three years had brought enormous economic gains across all sectors of the population.
The Indian economy is already struggling to grow before COVID-19 in terms of economy. The GDP grew at 4.2% in the financial year of 2019 to 2020.
Many economists have formed consensus over an economic contraction in India which if it happens will be the first time ever in Independent India.
The country is now gradually unlocking the economy after 4 months of lockdown imposition when businesses were shut.
Finance Minister Nirmala Sitharaman has earlier announced Rs. 20 lakh crore package to recover the economy from the losses due to the pandemic.
India has recently crossed 22 lakh positive coronavirus confirmed cases and the recovered cases have crossed 15 lakhs and the death rate due to coronavirus is just 2.8% in the country.
By Gayatri Yellayi