As coronavirus lockdown threatens recession across the globe, industry body ASSOCHAM has said that the government must look into a relief package of $200-$300 billion and has shared a 16-point agenda to tackle recession. “In keeping up with most economies of the world to institute stimulus measures with 10 per cent of the Gross Domestic Product (GDP), the Indian economy would need a transfusion of over $200 billion with an ability to go up to $300 billion, over the next 12-18 months,” Deepak Sood, Secretary-General, ASSOCHAM, said in a statement. Another industry body PHD Chamber of commerce and Industry has also suggested some short-term and long-term points to the government to mitigate the impact of coronavirus on economy, trade and Industry.
ASSOCHAM has also said that the funds should be infused with three objectives. The first objective is to provide assistance to employees and labour through direct transfers and through employers. Secondly, the government must ensure that the companies have enough cashflow to survive the downturn. Lastly, demand must be stimulated to revive the economy. Among the suggestions to the Finance Ministry, ASSOCHAM has said that the government must allow “one-time loan restructuring to all corporates assuming a principal repayment start date moving upwards from March 2021”. It also recommended that the NCLT provisions be held in abeyance for 6 months and RBI further announce a reduction of interest rate/repo-rate by another 100 bps.
As hospitality, aviation, tourism, transport, holiday operators, malsl, cinema owners have been especially hit by the coronavirus lockdown, the industry body has also sought 12-month interest waiver and 12-month moratorium on principal repayment. Among its other suggestions are: Increase of 25% to all standard loan accounts automatically, and 10% rebate in personal tax. “interdependency of the salaried and working-class with that of the businesses is the key parameter and therefore, it is essential for the country to revive the entire business eco-system that keeps them employed and businesses unburdened,” Deepak Sood added. The nation was put under a 21-day lockdown due to coronavirus.