What will be the economic scenario post COVID19?
Duvvuri Subbarao, a former RBI governor, said that India may look forward to a V-shaped recovery.
Economic recovery suggestions
On 23 April Confederation of Indian Industry (CII), in a paper titled "A plan for economic recovery", it has outlined three measures that the government must undertake such as cash transfers to JAM account holders, a credit protection scheme for Micro, Small and Medium Enterprises (MSMEs) and creation of a special purpose vehicle (SPV/SPE) to limit "Government exposure while providing adequate liquidity to industry". On 24 April Bina Agarwal, an Indian development economist suggested that the government "create green worker pools, not green zones" as a part of lockdown re-calibration efforts. On 28 April Anand Mahindra pointed that a graded re-opening of the lockdown will make economic recovery 'painfully slow'; with the economy being so very interconnected, the lockdown must be lifted comprehensively once the optimal lockdown period as per research has been completed. The Council On Energy, Environment and Water has proposed a greener recovery.
Task forces
For the revival of the India economy, white papers are being prepared by The Technology Information, Forecasting and Assessment Council (TIFAC), Department of Science and Technology. TIFAC has a "mandate to think for the future".The Punjab government has formed a group of experts led by Montek Singh Ahluwalia. The guidance for the same will be provided by Former Prime Minister Dr. Manmohan Singh.
State income and expenditure
Huge losses have been incurred by the State governments to the extent of having to cut capital expenses, the government plans in the near future and finding alternate ways to pay salaries. The Delhi government has fallen close to 90% short in tax collection as compared to 2019 and is planning to take loans and raise taxes in certain sectors. Maharashtra put a hold on all new capital works until March of next year; spending under government development schemes has also been reduced by 67% for the current fiscal.
Liquor
The Delhi government, as well as the Andhra Pradesh government, imposed a "corona" extra tax of 70%-75% on liquor. Excise duty on liquor is the third-largest source of income for a number of states, nearly 10-15% of total tax collection for some states. During the lockdown, the ban has affected alcohol sales, in turn, has a major effect on the state revenue.
Make in India Defence
In May, the Chief of Defence Staff General Bipin Rawat again emphasized the need for India to minimize costly defence imports and increase domestic production.
Covid-19 has affected everybody and made us have a major relook at our operational priorities and what we actually require. By boosting 'Make in India' project all our Indian industries will eventually deliver cutting-edge technology. We are not expeditionary forces to be deployed around the globe. We must not go in for large amounts of imports by misrepresenting our operational requirements.
