New Delhi: A big economic stimulus package worth of Rs 3 lakh crore is likely to be announced by Finance Minister Nirmala Sitharaman later this week, according to a media report.
According to the report by Business Standard, Finance Minister could announce a total of three trillion rupees or more for the country’s falling economy amid the coronavirus pandemic. The expenditure of all the initiatives put together is likely to be similar to what the G-20 countries are offering in terms of GDP percentage, the report stated.
It further said that the Centre is considering a measured approach to deal with the coronavirus lockdown situation in the country, which led to a pressure on the government from the industrial sector of the country. The government recently announced that it will borrow 54 per cent more than the budgeted estimate.
According to a government officials, quoted by Business Standard, “the next set of announcements would be massive compared to the Rs 1.7 lakh crore package announced earlier by the Finance Minister”.
Earlier in April, the Confederation of Indian Industry (CII), in a report, estimated the range of India’s GDP between a decline of 0.9 per cent and a growth of 1.5 per cent in the current FY, with the economy going through this unstable phase due to the coronavirus lockdown.
CII also said that the GDP is expected to grow at just 0.6 per cent on an annual basis as the economic activities are likely to remain in constraint due to the restrictions on the free movement of goods and people even after the lockdown period.
This will lead to disruption in supply chains, slow pick-up in investment activity, labour shortages in the short-run and muted consumption demand on account of reduced household incomes, the industry body added.
While in the optimistic scenario, foreseeing a faster pick-up after lockdown period, the GDP is estimated to grow at 1.5 per cent in the best case.
In case of a more prolonged outbreak, where the restrictions in existing hot-spot regions get extended, while new regions are identified as ‘hot-spots’ leading to intermittent stop and start in economic activity, GDP is likely to decline by -0.9 per cent, the CII had said.