India’s total lockdown to counter Covid19 has provoked a crisis - Recommendations for an economic stimulus package by Rahul Gandhi

Statement of Shri Rahul Gandhi, MP

May 08, 2020

It’s now 45 days since India was first put under lockdown. Even as the battle against the Covid19 virus continues across the country the reality is that the total lockdown has unleashed on India an economic tsunami of unimaginable proportions.

It is clear that we are not going to be able to get our economy moving again, without a massive economic stimulus from the Government. Most countries around the world have already announced huge stimulus packages to help restart the economy and ease the pain being suffered by their citizens. However, in India, the Government has been dragging its feet on announcing an economic package targeting vulnerable groups like farmers, migrant labourers and daily wage earners as well as industry clusters like travel & tourism, automobiles, retail etc. that have been severely damaged. The longer the Government delays announcing this package, the more the pain will grow and the tougher it will become to re-start the economy.

At this press conference, I want to share with you some of the key ideas about the contours of an economic stimulus package that have emerged through an internal Congress consultative process. I hope the Government will give these ideas serious consideration and incorporate as many of them as possible in the economic stimulus package, that I hope it will announce without any further delay.

Recommendations

1. Income Support

Extend ‘Income Support’ to at least 13 crore poorest households. Transfer Rs.7,500 preferably to each household. Even if Rs.5,000 is transferred to each of the 13 crore households, it will amount to a total of only Rs.65,000 crore, which we can and must afford.

2. MGNREGA

100 days of guaranteed wage employment under MGNREGA should be doubled to 200 days to provide more relief and avenues to earn. Close to 28-30% of our population now resides in urban areas. A MGNREGA like guaranteed wage employment programme must be introduced in urban areas as well.

3. Food Security

Ensure Food Security for even the 11 crore people currently outside PDS. Our go-downs are full of grains. Please ensure delivery of 10 kg food grains (rice or wheat), 1 kg pulses and 1 kg sugar to every individual every month for a period of next six months.

4.Agriculture & Farmers

Empower and support the ‘Anndaata’ farmer.
(i) Transfer Rs.10,000 as Urgent Income Support to each of the 8.22 crore PM Kisan Yojana accounts.
(ii) Purchase every ounce of food grains at MSP.
(iii) Remove GST on Fertilizers, Pesticides and Agricultural Equipment immediately.

5. MSMEs

6.25 crore MSMEs generate over 11 crore jobs. Give 1 lakh crore ‘Wage Protection Scheme’ & 1 lakh crore ‘Credit Guarantee Scheme’ to MSMEs. Give six months interest subsidy equal to six months of interest on loan taken by MSMEs.

6. Large Industries

Similar credit guarantee up and interest subsidy facilities must be extended to big businesses as well, provided they support their ancillary/auxiliary units. This will ensure the value chain continues to survive and no layoffs happen.

7. Shopkeepers

Except for hotspots, retail supply chains should be restored. This will bring relief to around 7 crore shopkeepers all across India.

8. Migrant Labour

I am deeply disturbed & saddened by news of trains being cancelled and migrants being forced to stay back in some states. They are not bonded labour and should be allowed to travel home according to their own free will. After announcements of buses and trains, why are thousands still forced to walk back to their villages?