Grossly insufficient booster dose to revive the economy
The last few days may have seen some of the most genuine attempts to be creative in policy terms by the Narendra Modi government. But it’s a question of scale. The series of announcements by Union Finance Minister Nirmala Sitharaman will not only need to pass the test in rather stern laboratory conditions. There will need to be more—much more. For, the extent of the gloom that surrounds us is not lost on anyone.
Sector after sector contemplates sudden death or decay. From the biggest captains of industry to the most immiserated migrant labourer, no one seems to be betting on an auspicious renewal coming soon. Such a turn surely seems beyond the reach of the government to impart, with its extremely limited means.
The very fact that a crisis is sought to be tackled with a novel set of ideas—and not nervous conservatism—is welcome. Some energies are bound to be released whenever an inertia of rest is broken; in recessionary times, any source of dynamism is worth its weight in gold. The ideas are not exactly novel, and have been hanging in a limbo for no one else’s fault.
Also, all those decisions that amp up the "private" quotient—in defence production, mining or aviation—can be subjected to stern examination. But later. (The "private is good" shibboleth is a piece of '90s dogma that people had occasion to revisit. Remember Air India rescuing everyone?) Yes, our fiscal space is so tight that it only allows for grim ‘tranche warfare’—a lot of ado over 1 per cent of the GDP!
The farm sector ideas are positive—some extra room to breathe for the farmer is precious. As COVID-19 has taught us, if you get oxygen, you don’t need to go on the ventilator. But when we need quick stimulus, we find the engines and the drivers of the economy in ICU.