Overcoming the pandemic’s challenge requires an economic policy reset -Roshan Kishore
A long-term look at this government’s economic policies suggests that for it to even consider a response the demand demand for a strong and equitable fiscal stimulus will require a reset of the existing economic policy framework
There is now widespread consensus that the second wave of Covid-19 will worsen India’s demand side problem. Even though there is no official data to prove this, most experts and private estimates suggest a significant rise in poverty and inequality. As a corollary, demand for a strong and equitable fiscal stimulus is rising once again.
A long-term look at this government’s economic policies suggests that for it to even consider such a response will require a reset of the existing economic policy framework. This framework, from the evidence on hand, displays a bias towards the formal sector, capital (when seen in the context of the capital-labour binary) and centralisation.
This may have been initially based on the premise of trickle-down growth but the protracted slowdown in the Indian economy, even before the pandemic hit, had already nullified any such assumptions. If these policies did not help before the pandemic, they are definitely counter-productive at the current juncture. A brief recap is useful to understand the issues at hand.
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Hindustan Times, 2 June, 2021, https://www.hindustantimes.com/business/overcoming-the-pandemic-s-challenge-requires-an-economic-policy-reset-101622629206711.html