India is facing one of its darkest hours and is caught between the need to contain Covid-19 and stop businesses from closing down.
Amitabh Kant, CEO, Niti Aayog, reportedly conveyed in a virtual interview that small businesses will bear the maximum brunt of the pandemic and people will lose jobs in the rural as well as urban areas. According to Kant, the Government’s priority should be to provide people living in the margins with a source of livelihood, and the best way to do it would be to directly transfer the benefit to them.
Some states, including Tamil Nadu and Kerala have announced free ration and a handout. However, support programmes at the national level to help the daily wagers and labourers are yet to be announced.
The head of the Government’s think tank explained that instead of worrying about fiscal deficit— which has increased to Rs 9.85 lakh crore— in this time of crisis, the Government needs to go out of the way to support industry.
He also clearly stated that the Reserve Bank of India (RBI) can play a significant role by making it easier for micro and small medium businesses to repay loans and allowing them more time for repayment. The practice of defaults post 90 days being declared as non-performing assets should be thought over, considering that businesses and factories will take at least seven to eight months to revive.
However, amidst this gloom, Kant feels that there lies an opportunity for India to become a major supplier. At a time when supply chains are badly affected, globally, India should grab this opportunity and use it to her advantage.