In order to deal with the economic fallout from COVID-19 and the consequent lockdown, Principal Economic Adviser Sanjeev Sanyal has said more calibrated monetary and fiscal stimulus measures are on the anvil. He expressed hope that a significant part of the economy will be functioning, if not everything, by May 3. He added that international passenger travel would remain shut for a long time, not for weeks but for months.
Regarding internal economy, he said it will be opened up in phases and efforts would be made to provide a cushion to the sectors hit hard by the lockdown through a series of measures from both fiscal and monetary sides. He noted that the Reserve Bank of India (RBI) has already announced two stimulus packages and Governor Shaktikanta Das has hinted at more measures in the future depending on requirement.
To mitigate hardships faced by the poor, he said the government last month announced a staggering Rs 1.70 lakh crore package to cushion the bottom of the pyramid by providing free food and ex-gratia. He said ‘we are willing to spend. We will spend a lot. We do have resources particularly on the monetary side but we will also make fiscal resources available...we will get a package sooner rather than later, which is already in preparation...we will do it in a calibrated way.’
Sanyal further said the Indian model to tackle the problem has been appreciated the world over. He also said ‘the world over people are now beginning to appreciate the approach we took. In fact, other countries are beginning to follow us. You have seen Singapore has gone back. So in many ways we are pioneers in this approach and well before the rest of the world would be out, the Indian economy will be opened.’ He highlighted that the world has also recognised efficiency of India's administrative machinery in handling such kind of lockdown without much of a problem.