Covid-19: ‘India’s fiscal response conservative, give Rs.5.5 lakh stimulus package’
New Delhi: Terming as ‘conservative’ India’s fiscal response to the global pandemic of Covid-19, the Azim Premji University has urged the Centre to announce a fresh stimulus package worth Rs 5.5 lakh crore to deal with the crisis.
Bold measures are required to emerge stronger from the crisis, said the report, ‘State of Working India 2021: One Year of Covid-19,’ released on Wednesday, according to media reports on Thursday.
It said the impacts of the pandemic’s second wave are still unfolding and may be as large, or even larger than the first one. The Centre’s principal scientific advisor K. Vijay Raghavan has warned about the inevitability of the third wave of the pandemic.
On Thursday morning, India recorded 4.12 lakh new infections and nearly 4,000 deaths in the last 24 years.
Coming as it does on the back of depleted savings, debt, and reduced fall-back options, the second wave can lead to potentially larger impacts on work, incomes, food security, health and education, the report said.
The states, who are at the forefront of the pandemic response in terms of containment as well as welfare, are severely strained in their finances. “There are thus compelling reasons for the Union government to undertake additional spending now,” it said.
The report proposed extending free rations under the PDS beyond June, at least till the end of 2021, and cash transfer of Rs 5,000 for three months to as many vulnerable households as can be reached with the existing digital infrastructure, including but not limited to ‘Jan Dhan’ bank accounts.
It also suggested expansion of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) entitlement to 150 days and revising programme wages upwards to state minimum wages, and enhancing the programme budget to at least Rs 1.75 lakh crore.
The report proposed launching a pilot urban employment programme in the worst-hit districts, possibly focused on women workers, and increasing the central contribution in old-age pensions to at least Rs 500.
A Covid hardship allowance to 2.5 million Anganwadi and ASHA workers of Rs 30,000 (5,000 per month for six months) was also suggested, among others.
“These measures, taken together, will amount to approximately Rs 5.5 lakh crore of additional spending and bring the total financial outlay on Covid relief to around 4.5 per cent of GDP over two years”, it said, adding, this large fiscal stimulus is justified given the magnitude of the crisis.
(VP)
