NEW DELHI: With the Centre likely to announce the much-awaited financial stimulus package this week to revive the pandemic-hit economy, Federation of Indian Chambers of Commerce and Industry (FICCI) president Sangita Reddy has written to Finance Minister Nirmala Sitharaman reiterating the chamber’s demands.
FICCI has sought around Rs 9-10 lakh crore, or 4-5 per cent of the India’s GDP, to stimulate the demand and supply and prevent a long-term economic slowdown.
“The problem being faced is largely that of liquidity and immediate release of money stuck in refunds and other government payments to the tune of Rs 2.5 lakh crore will immensely help the situation. This may have already been provided for in the budget,” Reddy said.
“Additional fiscal support required at current juncture for this purpose is about Rs 4.5 lakh crore.”
According to Reddy, additional fiscal support is required for vulnerable communities over and above the sum provided for in the earlier announced Garib Kalyan Yojana. Fiscal support to get MSMEs back on track, upgradation of healthcare infrastructure to effectively deal with the current situation and support for sectors such as aviation and tourism that have taken the maximum hit, were the other demands.
The letter also warned of massive job losses. “If we do not help industries (large and small), we will have large-scale job losses, which will contract demand significantly and lead to more pressure on the utilisation of businesses and their liquidity,” Reddy wrote.
According to the Centre for Monitoring the Indian Economy, India’s unemployment rate is now at a record high of 25 per cent.Whle other industry bodies have also called for fat stimulus packages, many experts feel that the government is unlikely to meet their expectations.