NEW DELHI: India Inc has demanded a fiscal stimulus package of Rs 6 lakh crore to refuel the crisis-hit economy post lockdown. "CII has suggested instituting a Government spending package equivalent to three per cent of GDP which would add Rs 6 lakh crore to the available firepower," Chandrajit Banerjee, Director General, of Confederation of Indian Industries said, while welcoming the move to relax economic activities in the green zone. Given the fiscal constraint, the industry body suggested that the Government could raise debt to pay for the package, given "modest" debt to GDP ratio of the country.
"Enhanced debt to GDP ratio can be a way out for adding fiscal space at a time when the debt to GDP ratio is modest in India." Banerjee argued. Meanwhile, Nitin Gadkari, Minister of Road Transport and Highways and MSME, said on Saturday that government is likely to announce a relief package for the MSME sector soon.
"We have sent recommendations for a relief package to the Finance Minister and Prime Minister and I hope it will be announced soon. We will try to give relief to the extent possible," Gadkari was quoted by the Federation of Indian Chamber of Commerce and Industry (FICCI) statement, where he addressed members via a webinar. Gadkari further said that in order to gain competitiveness in the international markets, the industry must focus on reducing costs.
"Our focus will be to reduce the logistic cost, capital cost, power and production cost without compromising the quality," Gadkari added. Most of the chambers have welcomed the relaxation given by the government for business activites in green zones. The chambers also argued that the relaxation to many industrial activities including industrial establishments in urban areas such as Special Economic Zones, industrial estates and industrial townships with access control within the Red Zone with restrictions, is absolutely in line with what they had recommended.