Swarajya Logo
Swarajya Logo
Politics States Economy Society Business Culture Infra Defence World Books Ideas Science Technology Heritage Archives Legal Movies Sports
  • Our Views
    Politics States Economy Society Business Culture Infra Defence World Books Ideas Science Technology Heritage Archives Legal Movies Sports
  • Magazine
  • Store

About Swarajya

Swarajya is a publication by Kovai Media Private Limited.

Swarajya - a big tent for liberal right of centre discourse that reaches out, engages and caters to the new India.

editor@swarajyamag.com

Useful Links

  • About Us
  • Subscriptions Support
  • Editorial Philosophy
  • Press Kit
  • Privacy Policy
  • Terms of Use
  • Code of Conduct
  • Plagiarism Policy
  • Refund & Cancellation Policy

Useful Links

  • About Us
  • Subscriptions Support
  • Editorial Philosophy
  • Press Kit
  • Privacy Policy
  • Terms of Use
  • Code of Conduct
  • Plagiarism Policy
  • Refund & Cancellation Policy

Participate

  • Contact Us
  • Write for us
  • Style Guide
  • Jobs

Stay Connected

  • Artboard 2 Copy 6Created with Sketch.
    Artboard 2 Copy 10Created with Sketch.
    Artboard 2 Copy 7Created with Sketch.
    Artboard 2 Copy 9Created with Sketch.
  • Andriod Logo
  • IOS Logo

News Brief

India’s ‘Helicopter Money’ Moment? Industry Body CII Suggests Rs 5,000 Direct Cash Transfer To 20 Crore People 

IANSSaturday, March 21, 2020 2:30 pm IST
Currency notes 
Currency notes 
Currency notes 

Time is ripe to implement India's version of "Helicopter Drop" fiscal support scheme to avert an impending economic disaster due to the outbreak of COVID-19, with industry body CII suggesting direct cash transfer of Rs 5,000 into the accounts of all adults with annual income of less than Rs 5 lakh per annum.

It said that for more vulnerable persons above 60, the cash transfers could be raised to Rs 10,000.

"This would be a temporary one-time measure to boost consumer demand," the industry chamber said in an action note on COVID-19 and its impact, industry and economy submitted to the Prime Ministers Office (PMO).

Though an old concept, Helicopter Drop was widely used in the 2008-09 economic crisis in the US. It entails providing a direct financial support to the public which can kick-start economic activity.

The Confederation of Indian Industry (CII) has said that as COVID-19 is expected to weaken growth impulses by acting through the trade and financial channels, expeditious policy redressal measures - both on fiscal and monetary front would be required. It is here that a fiscal stimulus of around 1 per cent of GDP, amounting to Rs 2 lakh crore, would be required to put money in the hands of people through Aadhaar-based Direct Benefit Transfer.

With regard to money to support large cash transfer programme, CII has suggested that savings from low oil prices could be channelised for additional spending required to keep the wheels of economy moving and preventing depression to seat in.

"With oil prices coming down, there are benefits for the economy. Every $10 dollar decline in the oil price leads to a saving of $15 billion in the oil import bill. This will create fiscal space for the government to make additional spending," the industry body said.

With a budget of Rs 2 lakh crore, 20 crore people can be compensated with a transfer of Rs 10,000 each or 40 crore people with a transfer of Rs 5,000 each.

Industry estimates and labour force survey data indicates that there are roughly 20 crore casual labourers who are employed. These are the most vulnerable sections and among the first to be hit on account of economics crisis being triggered by COVID-19. "They can certainly be compensated from the government''s fiscal resources," CII said.

With regard to other fiscal measures, the confederation has suggested that one month''s ration could be distributed to those below poverty line and to daily wage earners using food stocks available with FCI.

Further, it said tax-related announcements are need for restoring the health of the markets. In this regard it has suggested that long-term capital gains tax of 10 per cent should be abolished and tax on dividends to be taxed at an overall rate of 25 per cent at one point.

CII also said that government should also clear and pay their dues to the private sector, whatever the additional cost.

For the most distressed sectors such as Civil Aviation, Hotels, SMEs, Real Estate, Commercial infrastructure, CII said that specific relief should be given such as waiving off of taxes. A grace period of 30-60 days can be allowed in utility, statutory and GST payments for affected areas and industries without impacting credit history.

"Industry liquidity is stuck due to GST payments on raising of invoices. GST should be made payable on collection of proceeds instead of raising of invoices," the body has suggested.

CII has also suggested a series of monetary policy measures that RBI should take to ensure liquidity in the economy. It said that (Repo Rate) and Cash Reserve Ratio should be reduced by 50 basis points. Further, RBI should change definition of NPA recognition from 90 days to 180 days till September 30.

The central bank should announce a blanket moratorium on debt repayments for sixty days. This will help the corporates to tide over their immediate cash flow issues. This will reduce the insolvency risk of corporates and not put pressure on non-performing assets of the banking sector.

The confederation said that a concrete action plan to fight COVID-19 related disruptions is not possible unless industry also came forward and should shoulder some responsibility. It said that it has appealed to all its membership and beyond to explore possible ways to retain this workforce even as production lines slow down and to ensure payment of wages.

"Second and very importantly, companies need to explore if pay cuts can be taken at the senior management level to meet the cost challenges that industry is facing following loss in demand, trade and additional expenses," it said.

CII has also appealed to its members to take a proactive step in developing ventilators at low cost and at scale as going forward there may be a need to take urgent health measures to deal with the catastrophe.

All major private sector hospitals have identified isolation beds for corona patients. CII has also mapped out in 20 states, the list of private hospitals and the number of isolation beds, which they are willing to provide.

This news has been published via Syndicate feed. Only the headline has been changed.

Tags
CII
Indian government
Helicopter Money
coronavirus

Comments ↓

An Appeal...


 

Dear Reader,

 

As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.

 

Our business model is you and your subscription.  And in challenging times like these, we need your support now more than ever.

 

We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.

 

Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.

Get Swarajya in your inbox.


Magazine


Swarajya Magazine Cover Image
Merchandise

Merchandise


    Politics

    Axis-My India Exit Poll Gives Clear Majority To Congress In Telangana, Others Predict Close Contest With BRS

    Axis-My India Exit Poll Gives Clear Majority To Congress In Telangana, Others Predict Close Contest With BRS

    Nishtha Anushree
    3h

    Minority Student Scholarship Scam: Aadhaar-Based Biometric Authentication Helps Uncover 6.7 Lakh Bogus Applicants

    Nayan Dwivedi
    7h

    Jammu-Kashmir Ready To Conduct Elections, Waiting For ECI Instructions: Lieutenant Governor Manoj Sinha

    Nishtha Anushree
    9h

    Economy

    Sorry, Cassandras. India's GDP Could Well Top 7 Per Cent In Fiscal 2023-24

    Sorry, Cassandras. India's GDP Could Well Top 7 Per Cent In Fiscal 2023-24

    R Jagannathan
    11h

    India's GDP Grows 7.6 Per Cent In July-September Quarter

    Nayan Dwivedi
    1d

    India's Fiscal Deficit Stood At Rs 8.037 Lakh Crore In First Seven Months Of Fiscal Year

    Swarajya News Staff
    1d

    Defence

    India To Secure Entire Pakistan And Bangladesh Borders In Next Two Years: Home Minister Amit Shah On BSF Day

    India To Secure Entire Pakistan And Bangladesh Borders In Next Two Years: Home Minister Amit Shah On BSF Day

    Nayan Dwivedi
    5h

    Indian Navy Makes History By Appointing First Female 'Commanding Officer' Of A Naval Ship

    Swarajya Staff
    7h

    Centre Putting All-Out Efforts To Bring Them Back: Indian Navy Chief On Veterans Sentenced To Death In Qatar

    Swarajya Staff
    7h

    World

    COP28: PM Modi Asks Developed Nations To Fully Decrease Carbon Footprint By 2050, Applauds Fund To Combat Climate Change

    COP28: PM Modi Asks Developed Nations To Fully Decrease Carbon Footprint By 2050, Applauds Fund To Combat Climate Change

    Nishtha Anushree
    2h

    India-US To Bolster Ties In Pharma, Semiconductor Sectors; Honeywell, Pfizer, Kyndryl, Viasat CEOs New Joinees To Forum

    Nishtha Anushree
    5h

    COP28: PM Modi Proposes To Host COP33 In India, Emphasises On Need For Technology Transfer, Clean Energy Supply Chain

    Nishtha Anushree
    7h

    Culture

    Kashi Tamil Sangamam 2023 To Be Held From 17 December To 30 December, Registration Portal Launched By IIT Madras

    Kashi Tamil Sangamam 2023 To Be Held From 17 December To 30 December, Registration Portal Launched By IIT Madras

    S Rajesh
    2d

    M P N Ponnusamy: A Nagaswara Legend Passes Away Almost Unsung

    K Balakumar
    3d

    Streamlined Repatriation: India-US Deal To Fast-Track Return Of Stolen Antiquities

    Swarajya Staff
    4d
    States

    infrastructure


    V Bhagya Subhashini
    1

    Bengaluru Airport: BIAL Reveals Comprehensive Master Plan For T1 Upgrade And T3 Construction By 2030

    2 Mins Read
    Amit Mishra
    2

    Noida Proposes To Build 35 Km Elevated Road Along The Yamuna To Ease Travel To Greater Noida

    2 Mins Read
    Swarajya Staff
    3

    Noida Metro Expansion: DMRC Submits DPR For 11.5 Km Aqua Line Corridor Linking Botanical Garden To Greater Noida Region

    2 Mins Read
    V Bhagya Subhashini
    4

    Chennai Metro Phase II: CMRL Inks Rs 269 Crore Deal With Alstom For 10 Driverless Train Sets

    2 Mins Read