Rs 20 lakh crore: PM Modi announces mega bang economic stimulus

The package amounts to around 10% of India’s GDP and should go a long way in securing the country’s financial health.

by Brijesh Pandey - May 13, 2020, 10:57 am

It was Prime Minister Narendra Modi’s third address to the nation ever since the Covid-19 pandemic struck India and people across the country waited with bated breath to find out what he would tell them this time about the country’s next step in its fight against the deadly virus. And it proved to be worth the wait. The Prime Minister announced a “mega bang” economic package worth Rs 20 lakh crore.

The package amounts to around 10% of India’s GDP and should go a long way in securing the country’s financial health. In his speech he also mentioned that the fourth phase of the ongoing lockdown will be very different from its earlier avatars and will be powered by inputs from the states.

The details of the economic package will be announced by Finance Minister Nirmala Sitharaman in the coming days. In his 33-minute-long speech, the Prime Minister touched upon various aspects of life post Covid-19. A major part of his speech was dedicated to what he described as “Atmanirbhar Bharat”—a self-reliant but not self-centred India.

According to PM Modi, the way forward to make 21st century India’s is to ensure that we become self-reliant. He gave the example of how the production of PPE kits and N95 masks, which was negligible to start with, today stands at around 2 lakh units per day. Speaking about how the definition of self-reliance has changed in today’s globalized world, the PM clarified that our culture considers the world as one family and progress of India is also progress of the world.

Recalling the devastation caused by the Kutch earthquake and the following turnaround, PM Modi said that the area got back on its feet because of its determination and resolve— the same is needed to make the country self-reliant. PM Modi said that a selfreliant India stands on five pillars—economy, which demands a quantum jump and not incremental change; infrastructure, which should become the identity of India; system, based on 21st century tech-driven arrangements; vibrant demography, which is the source of energy for a self-reliant India; and demand, where the strength of our demand and supply chain should be uticapacity.

PM Modi then announced the special economic package of Rs 20 lakh crore, which includes the earlier ones announced by the Reserve Bank of India, and is equivalent to around 10% of the GDP. According to him, this package will provide a boost to the concept of “Atmanirbhar Bharat” and will also focus on land, labour, liquidity and laws. The details of the package will be announced by the Finance Minister in the next few days.

PM Modi also spoke about how several bold reforms were the need of the hour to make the country self-reliant—something that can negate the impact of Covid. He also spoke about the positive impact of reforms like the JAM trinity, among others. The reforms he spoke about includes supply chain reform for agriculture, rational tax system, simple and clear laws, capable human resources and a strong financial system, which will attract investment.

The Prime Minister added that the package would also focus on empowering the poor, the labourers, the migrants, etc. He also spoke about the need to go “vocal” for “local” and said that the top brands of the world were once local before they attained cult status globally. He said that all our demands have been met locally and now it’s time to help these local products go global. Laying emphasis on how several experts have said that this virus is going to be part of our lives for a long time, he said that people should work towards their targets while taking precautions like “do gaz doori”.

The part about the lockdown was saved for the last, when the Prime Minister announced that the fourth phase of the lockdown starting from 18 May will be seen in a brand new avatar. Referring to the meeting he had with the Chief Ministers, the Prime Minister said that on the basis of the recommendations received from the states, new rules would be framed. He thereby hinted that the majority of the recommendations made by the states as well as the blueprint they submit on 15 May would be accepted and Lockdown 4.0 woul.