The central government has indicated that another relief package can be given to give the right momentum to the economy. A senior government source told a news channel that the option of another relief package has not been discontinued.
Significantly, the opposition party and many economists are calling PM Narendra Modi’s Self-Reliant India package ineffective, yet the government is indicating to give another relief package.
Emphasis on increasing demand
According to sources, this time the finance ministry may once again insist on increasing demand in the economy. On this Monday itself, Finance Minister Nirmala Sitharaman made four major announcements to increase the demand in the economy.
These include giving LTC cash vouchers and festival advances to government employees, loans to states without interest for 50 years and additional capital expenditure of Rs 25 thousand crore by the central government. The Finance Minister said that these steps will generate demand of about 73,000 crore rupees in the economy.
Why relief package is important
The condition of the economy is bad because of the Corona crisis. The Indian economy has fallen by about 24 percent in the June quarter, due to this it is a compulsion for the government to take more steps now.
A senior finance ministry official said that until last month, the government was not willing to offer any new package. But the unlock has not been implemented with uniformity in all states and there are still many restrictions on the movement of goods and people. Because of this, the government now feels that the relief package can be more effective for the economy.
What are the fears
However, there are many doubts about the level of relief package, that is, how much. The government does not want to tamper with its fiscal targets. The target of deficit is already going away.
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