advertisement
Video Editors: Sandeep Suman, Varun Sharma
Yeh Jo India Hai Na, it is fighting a second big battle – and that is an economic pandemic.
Visuals from Pune show the railway station packed with people, with bigger worries than social distancing. And pictures from a bus stand in Kolkata show thousands of workers desperate to get back to their villages. They are waiters at restaurants that are shut, housekeeping staff at offices that are shut, loaders of goods at factories that are shut. They’ve been told, ‘Daftar, hotel, factory... sab band, salary nahi hai, ghar jaao. Do-teen mahine ke baad dekhenge. (Offices, hotels, factories... all are closed, there’s no salary, go home. We will reconsider it after two-three months.)’
Now multiply this scenario for industrial cities and big metros across India. Across Mumbai, Delhi, Gurgaon, Chennai, Coimbatore, Kochi, Surat, Ahmedabad, Ludhiana, Noida, Kanpur, Hyderabad, Bangalore, Mangalore, lakhs of them, suddenly with no jobs, heading back to their villages – the direct and immediate result of the coronavirus lockdown. An additional worry: If any of them are positive cases of coronavirus, then this exodus from the cities, is one sure way of the pandemic spreading to rural India.
So, even as the coronavirus pandemic is very rightly our number one priority, we can’t afford to ignore the economic pandemic. Businesses and industries of all sizes are seeing a slump due to the lockdown, and millions are losing their jobs as a result of that. They all need immediate financial support just to survive, and fiscal stimulus to get restarted as and when the pandemic starts to retreat.
So, how can the country deal with this crisis?
For instance, the Modi government says it has opened over 38 crore bank accounts amongst the country’s poorest, as part of its Jan Dhan Yojana. Could an Emergency Direct Cash Transfer of even Rs 5,000 be made into each of these accounts? It will greatly reduce their immediate distress.
Another fire-fighting suggestion: Why not announce interest-free or low-interest bank loans for the next three to four months for medium, small and micro enterprises, who don’t have the deep pockets to tide over a short-term crash in business or demand?
Why not get the RBI and India’s mega banks to make major cuts in their lending interest rates? That would be an immediate boost for the economy.
How about a six-month suspension of EMI payments for those with home loans or business loans?
How about reducing the price of petrol and diesel at a time when oil prices are at their lowest in years? That would give the public some spare spending money, which would create internal demand for the Indian industry.
While the Indian government is silent, other countries are fighting the coronavirus and the economic pandemics simultaneously. The United States, even as its COVID-19 numbers are soaring, has also announced a UD 1 trillion fiscal stimulus package for its economy. France has announced a 45 billion euro package, and even Italy, worst hit by the pandemic, says it will spend 25 billion euros to restart its economy.
So, why is the Indian government doing so little? Well, partly because the government itself is already short of money! From GST and from Income Tax, the Indian government’s revenues are way short of their own calculations.
On top of that, India’s GDP growth is already at a low of 4.5 percent. Leading financial analyst Ruchir Sharma now says that in the year ahead for India to grow at 3 percent will be a miracle. He adds that the global economy is set to contract by 5 percent. Even China’s economy will contract for the first time in 40 years. American stock markets have crashed 32 percent in three weeks. The Indian stock market has crashed by 35 percent in two months. None of this has ever happened in either country’s financial history.
Given how acute the problem is, how ‘never-before’ it is, how we don’t even know if the worst is over, or yet to come, all one can say at the moment is –
Yeh Jo India Hai Na… If it wants to survive, we must urgently acknowledge that there is a huge economic pandemic as well, and then get serious about dealing with it.
We'll get through this! Meanwhile, here's all you need to know about the Coronavirus outbreak to keep yourself safe, informed, and updated.
(Make sure you don't miss fresh news updates from us. Click here to stay updated)
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)