Amid fears of new infectious disease spread, the Federation of Indian Chambers of Commerce and Industry (FICCI) has said that there is an urgent need to take immediate steps to contain the spread of coronavirus and address key pain areas of the industry which can help in minimising its impact on Indian economy and businesses.
The industry body in its a latest report titled 'Impact of COVID-19 on Indian Economy' noted that a combination of monetary, fiscal and financial market measures is needed to help the businesses and people cope with the crisis. It also said that the outbreak has presented fresh challenges for the Indian economy now, causing a severe disruptive impact on both demand and supply-side elements which has the potential to derail India's growth story.
As per report, the government and Reserve Bank of India (RBI) need to support the industry and economy at this juncture by bringing down the cost of funds further through a reduction in policy rates (say by about 100 basis points). It also expressed need of steps to maintain liquidity at surplus levels and provide special liquidity support for any companies, non-banking finance companies and banks that come under strain due to intensifying risk aversion in financial markets or due to large demand shock.