Tamil Nadu prepares master plan to revive economy

Simultaneously, the State government also indicated that it was awaiting its share in the Rs 20 lakh crore stimulus plan announced by the Centre.
For representational purposes
For representational purposes

CHENNAI: Even as Tamil Nadu struggles to cope with the lockdown financially, the high-level committee formed under the leadership of former RBI Governor C Rangarajan, met on Thursday to formulate strategies to boost the economy. Simultaneously, the State government also indicated that it was awaiting its share in the Rs 20 lakh crore stimulus plan announced by the Centre.

“We need to assess to what extend the State economy has been affected,” said Rangarajan, addressing the media after the meeting. “We need to devise short and long-term strategies. Economic reforms required need to be discussed and explored. The impact would depend on the total duration of the lockdown. We have formed sub-groups to study the impact on different sectors.”

Meanwhile, deputy CM O Panneerselvam, who also handles the finance portfolio, said the State was looking forward to the next set of announcements by the Centre, as States are in urgent need of financial support. Till now Tamil Nadu has received Rs 312 crore as COVID-19 relief package under the National Health Mission.

However, the Centre is yet to provide further assistance to tide over the lockdown as the State revenues have dried up. “We had sought Rs 13,000 crore besides an ad hoc grant of Rs 1,000 crore from the NDRF to procure medical needs,” an official source said. It is learnt that the Rs 1,393 crore GST component released to Tamil Nadu recently was for the period ending December 2019.

In the first phase of lockdown, the Centre has announced Rs 1.7 lakh crore package for the country under which Rs 500 crore was provided to Jan Dhan accounts in the state as well as 5kg rice and 1kg pulses for three months.

However, funds are trickling in. This month, the state has been able to get Rs 2,000 crore Goods and Service Tax. This GST componenent was pending in March and next month there will hardly be any revenue from GST as no industrial activity happened in April, sources said.

Meanwhile, the state's bid to generate revenue through alcohol sales suffered a blow due to Madras High Court's recent order banning it. Sources said only Rs 100 crore could be earned during the two days of sale.

Under the budgeted grants, the state has got Rs 4,800 crore from the Centre, sources added.

Hoping that some industrial production would start to happen by July. "This is not a tsunami where you have to rebuild everything. It is a lockdown where the economy is standstill and we need to generate revenue," an official source said.

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