Could govt give more economic stimulus after Rs 21 lakh cr package? Story can’t end here: FM Sitharaman

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Published: May 20, 2020 1:10:01 PM

Days after announcing the Rs 21 lakh crore AtmaNirbhar package, Union Finance Minister Nirmala Sitharaman has said that she is ready to respond even further as uncertainty looms large over the coronavirus pandemic and its extent.

Full break-up of 20 lakh crore rupee economic package, aatmnirbhar bharat, finance minister nirmala sitharamanThe finance minister said she will not make assumptions about what sort of budget allocation would be enough to tackle the problems being faced by the migrants.

Days after announcing the Rs 21 lakh crore AtmaNirbhar package, Union Finance Minister Nirmala Sitharaman has said that she is ready to respond even further as uncertainty looms large over the coronavirus pandemic and its extent. “I have to be ready because no one knows how this is going to turn out, how this is going to end, how this is going to withdraw. So obviously I have to be ready, I can’t finish my story with these announcements,” Sitharaman told The Indian Express in an interview. The Finance Minister said that the government considered many suggestions before announcing the five trances of the Rs 21 lakh crore package last week and this was a result of an extensive and open exercise.

“I have heard a lot of suggestions, and I have said this even earlier. The suggestions have come from so many people, experts, economists, students, former officials. We have taken all these into cognisance and studied these at various levels and we have come out with this (package),” Sitharaman said. The Finance Minister said that she will refrain from arguing with various assumptions on the fiscal impact of the package announced, and urged people to assess where the liquidity is going to spread. “I have laid it before everybody. Now if you want me to tell you the outlay from the Budget, let me tell you this is the Government of India, Ministry of Finance, dealing with public money. I will have to stand up in Parliament and say, sometime — and I will do it — but at this stage what is it that you want? Is the money going to the place where it should actually go, is it going on time, look at all that,” she added.

The central government announced the package in five-tranches focusing on various sectors and industries throughout the week. In an effort to help the migrant labourers get paid-work, the government hiked the MGNREGA budget by Rs 40,000 crore, a move made keeping in mind the large influx of migrants traveling to their native places. Sitharaman confessed that it is difficult to assess if the hike in MGNREGA will be enough to cope with the demand for work that rural India might witness. “What is going to be enough, even if I know, let’s not simplify the complexity of the problem… because the displacement and the type of displacement and the notional cost of it, the uncertainty it will lead to about how, and if at all, will they come back,” she said. The finance minister said she will not make assumptions about what sort of budget allocation would be enough to tackle the problems being faced by the migrants.

Government’s economic package refrained from cash transfers to the poor, as suggested by Nobel laureate Abhijeet Banerjee earlier this month. Sitharaman said that the suggestion was something that was put across the table while the plan was being framed up, but defended the government’s decision to give collateral-free loans instead. “Automatic is the word I use, what is that aimed at? It is aimed at giving some money to meet the fixed cost, it is aimed at giving some money to make sure that some payment for the wages are made. So that’s what we have done,” she said.

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