“As new normalcy comes we will have to be innovative, and we will have to put money in the hands of the consumer,” said Bharat Puri, MD, Pidilite Industries.MUMBAI: Creation of liquidity and demand apart from boosting consumers’ confidence are key factors that would help revive the Indian economy and pull it out of the ongoing Covid-19 led slowdown, experts said while comparing the current situation with the 1991 Balance of Payment crisis.
Given the damage caused to the economy, consumption can resurge only with policy interventions including the incentives, sops and making people confident about future growth.
“We need very comprehensive systematic solutions to fix a lot of things…reforms, ease of doing business, and sanity in policy decisions will help get the confidence back,” said Rashesh Shah, CEO, Edelweiss Group.
He believes if the government is offering investment concessions, it needed to make sure that it’s there for long term so that “animal spirits” can come back.
Consumers are currently concerned about their incomes and future growth and therefore may not spend much. However, the government and businesses will have to get prompt them to spend as situation moves closer to normalcy.
“As new normalcy comes we will have to be innovative, and we will have to put money in the hands of the consumer,” said Bharat Puri, MD, Pidilite Industries.
Most panelists were of the view that putting more money in consumers’ hand will boost the demand. Cipla’s MD & Global CEO Umang Vohra believes a more structural solution would go a long way on resolving the issue.
“At this point in time, employment and getting people to remunerative work is the most important task of the government. And if that comes, you know, you really don’t need to put too much of money back,” Vohra said while adding that sectors like MSME and construction need more support.
Reverse migration of labourers has turned out to be one of the biggest pressure point of the ongoing crisis. However, Piyush Singh, senior MD & Lead India Market Unit, Accenture is of view that this can be an opportunity to build an organized financial system across India especially rural parts. He suggested unleashing some credit in rural areas to fund the innovation and create micro SME opportunities for the migrants.
RS Sodhi, MD, Amul also believes if the government starts investing more in rural economy the estimated 2 crore labourers that have migrated back can help push the rural economy with new small businesses and employment.
Source: indiatimes.com
