Economic crises are often opportunities in disguise. In 1991, the balance of payment crisis which forced India to pledge its gold reserve to raise money, set the stage for P.V. Narasimha Rao and Manmohan Singh to initiate reforms to liberalise the economy. Now the Narendra Modi government is using the Covid-19 pandemic-induced financial crisis to push through many held-up reforms to make India “self-reliant”, with less government control and more privatisation.
The package announced by Finance Minister Nirmala Sitharaman revealed that the government had a different prescription for the ailing economy. In almost similar circumstances in 2008-09, prime minister Manmohan Singh focused on creating demand by giving cash transfers, a method which the Congress and a host of noted economists like Raghuram Rajan and Abhijit Banerjee still vouch for.
The Modi government is betting on infusing liquidity into the system, extending easy loans to enterprises and preventing them from going bankrupt. The emphasis has been on securing the supply side. The message is clear—there are no free lunches for the industry. If there are hindrances in running a business, the government will remove it. Even the migrant labourers and the poor who were hit hard by the lockdown were provided support through the institutional methods of the Public Distribution System, the Ujjwala scheme for cooking gas and women Jan Dhan accounts.
Ironically, the Atma Nirbhar push has been used to dismantle the Nehruvian structures of self reliance—the public sector units—and amend the Essential Commodities Act 1955, which will help deregulate the agriculture sector. The government has opened up mining, aviation, defence, space and atomic energy sectors for greater private participation.
Bu hikaye THE WEEK dergisinin May 31, 2020 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Giriş Yap
Bu hikaye THE WEEK dergisinin May 31, 2020 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Giriş Yap
Stop ruling; start governing
In every election the voters elect a government.
HEALING THE EARTH
Land Restoration for a Drought-Resilient Future
Speak of the nawab
For Heeramandi's male lead, Taha Shah, the road to success was paved with flops
Northern delights
Four Kashmiri fashion labels that want to put the troubled region on the international style map
WOOING THE WAVES
India is developing strategic ports overseas and is exploring new oceanic trade routes to pursue its growing geopolitical objectives
TIPU, SULTAN!
In his first major election after the death of Mulayam Singh Yadav, Akhilesh humbles the BJP and proves he is his own man
A SLEEPER HIT
Naidu’s stunning victory raises questions about the vote-catching power of welfare schemes
SWEEPING LOSS
AAP’s disappointing performance has put a question mark on its relevance in the INDIA bloc
INDEPENDENTS' DAY
The Lok Sabha results in Baramulla and Ladakh reflect a churning among voters
Voters have changed, and we have benefited
In March 2022, Vice President Venkaiah Naidu asked a quirky question to actor-MP Suresh Gopi, who had come to the Rajya Sabha with a distinctive look.