Jayati Ghosh, development economist and professor at Jawaharlal Nehru University (JNU), interviewed by Rajat Mishra (Outlook India)
The government needs to have a large fiscal stimulus. It needs to put more money in the hands of the poor and vulnerable, Jayati Ghosh, development economist, and professor at Jawaharlal Nehru University tells Outlook.
The government recently announced Rs 1.7 lakh crore economic package to help the poor deal with the impact of coronavirus and a 21-day nationwide lockdown imposed to contain the spread of the disease. Experts think that the complete lockdown may deepen India’s economic slowdown. In an interview with Outlook’s Rajat Mishra, development economist, and professor at Jawaharlal Nehru University (JNU) Jayati Ghosh explains how the COVID-19 crisis will impact the Indian economy and what the government needs to do. Excerpts:
* Indian economy was already in the grip of a slowdown. And now the government has announced a 21-day lockdown to contain the spread of coronavirus. How do you think it will impact the economy?
The Covid-19 crisis and the nationwide lockdown will together result in serious economic devastation. And, I think it will be to the extent that we have never experienced before. We are in a peculiar situation where there is a demand as well as supply collapse.
* Finance Minister announced Rs 1.7 lakh crore relief package for the poor. Do you think it is enough given the degree of economic damage unleashed by this pandemic?
First, it is not Rs 1.7 lakh crore package. Many relief measures that were announced were already included in the budget earlier, for example, PM Kisan Yojna. Just because the government hasn't paid several dues for the current year and it is bringing forward existing payments; it hasn't doubled or tripled them as it should have been.
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Outlook India, 1 April, 2020, https://www.outlookindia.com/website/story/business-news-coronavirus-crisis-lockdown-will-result-in-unprecedented-economic-devastation-jayati-ghosh/349829