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Thursday, November 26, 2020

Have not closed the option for another stimulus: Nirmala Sitharaman

To a question on whether the Finance Ministry would come out with an assessment of economic contraction, Sitharaman said the ministry has started doing some assessment since the beginning of October and would soon come with a projection.

By: ENS Economic Bureau | New Delhi | Updated: October 20, 2020 12:34:59 am
Finance Minister Nirmala Sitharaman (PTI/file)

Finance Minister Nirmala Sitharaman on Monday said the government has not closed the option of one more stimulus to support the economy. The Finance Ministry has started its assessment of the likely economic growth for the current year and will release the estimates when they are ready.

Speaking at an online conference to launch the autobiography of 15th Finance Commission Chairman NK Singh — Portraits of Power: Half a Century of Being at Ringside — Sitharaman hoped for improvement in the education sector and further opening up of the economy to the private sector.

“I have not closed the option for another stimulus. Every time we have announced one, it is after a lot of consultations with various sections of society and then we work with ministries, the PMO (Prime Minister’s Office) and then take a final call. Yes, I have not closed the option to come out with one more stimulus,” Sitharaman said to responding to a query. Amid the government planning to come out with a public sector enterprise policy to open up all sectors for the private sector, she said India needs to move away from “the socialistic baggage”.

Stressing the need for a robust federal structure in the country, she said: “Federalism is needed to make our country stronger. We need greater robustness in federal engagement as even if one state is left behind, it can slowdown India’s growth potential.”

Singh, who has had a long career as a top bureaucrat and a former MP, said his book tries to look at the brighter side of society and economy in terms of what is possible to be done within the given constraints. Quoting Plutarch, Singh said: “To find fault is easy; to do better may be difficult”. The book also tries to address whether the Covid-19 pandemic is like a “1991 moment in our history” where we are forced to push the reset button, Singh said.

Reliance Industries CMD Mukesh Ambani, who participated in the discussion, said some of the most second generation reforms have been taken in last six months in agriculture, labour and education sectors. He said there is need to support small and medium enterprises and order to create an eco system entrepreneurship grows. Some of that is happening already in the batteries and solar manufacturing areas.

To a query on what he wished to be remembered for, Ambani said it “should not be about him but his contribution to the society” and he wished to work on three things — transformation of India into a digital society; transformation in education sector to strengthen the skill base in India through linkages among education, skill training and employment; and lastly a movement away from fossil fuels towards completely renewable energy over the next three decades.

Ambani said his first impression of Singh was that “the IAS guys have style” and he was struck by his unending curiosity and ability to deliver on economic reforms.

Speaking at the event, Singapore’s Senior Minister and Coordinating Minister for Social Policies Tharman Shanmugaratnam said India’s challenges exceed those of most societies facing Covid-19 but the pandemic also represents a “huge opportunity” for the country as the global supply chain is changing. This presents an opportunity to become a major producer of goods and services for the world.

The production-linked incentive (PLI) scheme has been a very good start, but there has to be further momentum and implementation, he stressed.

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