Hours after Finance Minister Nirmala Sitharaman announced a relief package to the country to help fight the Chinese epidemic COVID-19 yesterday, NITI Aayog Vice Chairman Rajiv Kumar stated that it was just a welfare package and a comprehensive stimulus package is yet to be announced by the Modi government.
Speaking to India Today, NITI Aayog Vice-Chairman Rajiv Kumar said that the Modi government is likely to announce more measures that will have a wider impact on economic activity, and also address liquidity issues in the economy.
Commenting on the relief package announced by the Finance Minister, Kumar said that it was a fairly substantial welfare package given by the government to protect the poor, vulnerable who are likely to be most affected during the lockdown due to loss of livelihood opportunities.
Reportedly, Kumar also stated that the relief package for the marginalised announced by the Modi government on Thursday established the government’s priority in taking care of people who are most affected by the crisis.
“Subsequent packages will follow, focussing on how to prevent a wider impact in economic activity, so liquidity is addressed, and this situation does not lead to insolvency and bankruptcy,” Kumar said. “This is the highest priority of the government right now,” he added.
However, Rajiv Kumar also expressed his apprehensions about Gross Domestic Product growth likely being impacted in the next fiscal due to zero economic activity right at the beginning of the fiscal.
“In the next quarter, we will be lucky if we get a zero-growth rate. But it (GDP growth) could be even in negative. The overall growth rate for the financial year, however, will not go below 3-3.5 per cent. It’s too early to say anything because there are many factors that remain unknown,” Rajiv Kumar said.
He also added that the lockdown is an absolute necessity to “break the chain” and contain further spread of the deadly coronavirus. “We are hopeful that the number of new cases will fall and things will return towards normalcy. I am hopeful that three weeks would be enough for the Indian economy to bounce back,” he added.
Finance minister Nirmala Sitharaman on Thursday unveiled a Rs 1.7 lakh crore economic relief package to help the poor and marginalised. Her announcement came as 21-day nationwide lockdown began on Wednesday to curb the spread of highly contagious illness.
“No one will go hungry”, the Finance Minister had said, announcing relief under the Rs 1,75,000-crore package, dubbed as “Prime Minister Gareeb Kalyan scheme”. The central government’s immediate focus is on alleviating the hardships of the migrant workers, urban and rural poor, she had added. The government also announced a special Rs 50 lakh medical insurance cover to the frontline workers toiling to avert the crisis.