Is there a path to economic revival?
The COVID crisis has laid bare cracks like economic inequality; its impact has been so profound on the people who can least afford it. This time we don’t know how this crisis will kick in.
The Indian economy had already been showing signs of distress much before the arrival of the pandemic. Any attempts of reviving the economy have only become more difficult as the effects of a lockdown have intensified the downward pressures on the economy.
In this vein, it is important to identify the right policy mix of both fiscal and monetary measures that will directly boost employment and effective demand in the economy, which will then automatically feed into private investments by boosting business sentiments.
Relief measures might help keep households running, but they won’t be sufficient. An economic stimulus package will be needed to rekindle economic growth.
The term “economic stimulus” is usually tagged with a multi-billion dollar figure. But in the Indian context, fiscal and monetary stimuli will need to be accompanied by a clearing out of the regulatory cholesterol that clogs the economy’s arteries.
Policy Pandits considering stimulated packages essentially have two choices: They can lock in decades of polluting, inefficient, high-carbon, and unsustainable development, or they can use this as an opportunity to accelerate the inevitable shift to low-carbon and increasingly affordable energy and transport systems that will bring long-term economic benefits. The latter will also fight two major crises head-on: air pollution and the growing climate emergency.
We cannot punt the climate emergency down the road. This year, countries must deliver national climate commitments for 2030 aligned with reaching a net-zero emissions world by 2050.
Mauritius, for example, is planning to generate over a third of its electricity from renewable sources within the next five years.
Reducing pollution this shift to clean energy is expected to aid economic recovery, with new jobs in areas such as the production, installation, and maintenance of renewable energy equipment, from solar panels, to batteries and wind turbines.
Another added benefit is energy security: with such a high dependence on imported oil, price fluctuations can make budgeting difficult, and any interruption to supply can have serious consequences.
Home-grown energy from renewable sources can make the energy grid more reliable, and more resilient.
Identifying gaps in social development across the country can provide a yardstick for developmental policymaking.
It is not just in the context of post-pandemic economics, but in the overall developmental planning of the country, that these expenditures are necessary as they entail certain essential public goods.
Opportunities lie in the gig economy and e-commerce sectors, with future employment the new technologies can help support future response and resilience mechanisms along with proper rules regulations of data privacy and cybersecurity.
The use of fiscal mechanisms can help support recovery and resilience efforts while promoting low-carbon development.
For example, the government announced relief packages for the disadvantaged section.
Coming to some Optimistic Predictors predictions, by implementing bold decisions and also considering five, I’s Intent, Inclusion, Investment, Innovation & Infrastructure will lead to a systematic, integrated, planned, interconnected, and futuristic process. In short, the economic recovery will be a Z-shaped recovery.
Walk towards the self-reliance mission can help India get back this difficult path.
The ambitious mission is all about getting the best from the world and creating world-class products. The local campaign will help Indian companies to create world-class products, capture the Indian market, and use the strength of the domestic market to penetrate the global market. This will become a ground reality sooner rather than later.
At Mitti Ke Rang, we started with a COVID-19 community support fundraising, as an emergency response to provide a safety net to families. This will help them survive in the lockdown period. We aim to directly support these families by providing a minimum wage, through transferring the same into their accounts or partner with local NGO, Organisation, Fellow, or a Volunteer and support them with groceries.
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