India needs to lift its lockdown in a “measured way” but as fast as possible as it does not have the capacity to support people across the spectrum for too long, former RBI Governor Raghuram Rajan said, as he argued that the country needs to spend Rs 65,000 crore to support the poor. He said India has to be “cleverer” about opening up and argued a second or third round of lockdown will be devastating for the Indian economy.
In a conversation with former Congress president Rahul Gandhi, Rajan said “there will have to be a rethinking of everything in the global economy” post-Covid-19 and argued India has an opportunity in shaping that dialogue towards “one which has greater place for more countries in the global order, a multipolar global order rather than a single or a bipolar global order.” He said India can find opportunities for its industries and its supply chains.
He said there has to be a sequencing when it comes to opening up and the first should be those places where social distancing can be maintained. But, for that, he said “a lot of work needs to be done both on creating the structures, as well as ensuring that the work place is relatively safe.”
Referring to a survey by Centre for Monitoring Indian Economy which said an estimated 100 million workers have been rendered jobless due to the lockdown, he said the numbers are “worrying” and “mindboggling” and “I think it says, we need to open up in a measured way but as fast as possible so that people start having jobs. We don’t have the capacity to support people across the spectrum for too long. Being a relatively poor country, people start out with significantly lower reserves.”
“We need to find ways of getting both money as well as food through PDS to as many of these people as we can,” he said.
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