India Inc seeks stimulus package after lockdown extension
Late last month, the government announced a Rs 1.7 lakh crore package aimed at providing relief to those hit hard by the lockdown
New Delhi: India Inc on Tuesday said the nationwide lockdown extension was necessary to avert a humanitarian crisis, but insisted on the need for a stimulus package to rebuild the economy hit hard by the Covid-19 pandemic.
Union Minister Nitin Gadkari on Tuesday asked India Inc to clear huge outstanding payments to micro, small and medium enterprises at the earliest in order to ease the distress in the sector and inject liquidity into market.
In a discussion with senior industry members of Ficci via video conferencing, the MSME minister exhorted the industry to clear pending dues owed by them to the units.
"I would like to request you, major industries also have huge outstanding dues of MSMEs. We were earlier considering framing a law entailing stringent rules regarding such payments. However, now is not the right time for this. We do not wish to go down that road," the minister said.
Earlier in the day, Prime Minister Narendra Modi announced that the current lockdown will be extended till May 3, saying it is necessary to contain the spread of the novel coronavirus in the country.
He said detailed guidelines on implementation of the new lockdown will be announced on Wednesday, and some relaxations may be allowed after April 20 in places where there are no hotspots.
Late last month, the government announced a Rs 1.7 lakh crore package aimed at providing relief to those hit hard by the lockdown as well as an insurance cover for healthcare professionals handling virus infected people.
Estimates show that India may be losing close to Rs 40,000 crore daily due to the national lockdown with an estimated loss amounting to Rs 7-8 lakh crore during the past 21 days," said Ficci President Sangita Reddy.
Further, it is also expected that close to 40 million jobs are at risk during the period April-Sept 2020. Hence, an urgent relief package is also critical, she said.
CII Director General Chandrajit Banerjee said the Covid-19 curve trajectory as of now required a fitting containment response and Prime Minister's decision for continuation of the lockdown is necessary to avert a larger humanitarian crisis.
"The extension gives the government adequate preparation time to organise an orderly and safe restart of the economy as and when health conditions permit. Industry too can devise its strategies for commencing operations accordingly duringthis extension period," Banerjee said.