Topic: India's new financial package is a national laughing stock - what do you think? (Read 686 times)

Lets not call it "Leadership". This man is simply out there trumpeting himself in the hope of establishing himself as a sort of RW parallel to Nehru. The freakish tendency to coin acronyms and tell people out 3 D'S, 4 S's or whatever the fuck he come up with next is worrying. Authorities down the line are least concerned about performing or real ground results as long as the media and the ardent supporters remain hypnotized.

The loans being extended to MSME's on a "No-collateral, zero interest" for first year are basically business loans which the Indian economy would have needed anyways. Especially after the fiasco of an ill-implemented GST. In the garb of this package, the opportunist BJP has exposed its true neo-liberal face. They literally have zero idea about the poor and disenfranchised of this country. They completely forgot about the migrant workers while implementing the lockdown resulting in people walking hundreds of kilometers on foot to reach their villages where they could hope to at least have food to survive. All the much touted "Dreams of new India" have been ruthlessly crushed by this calamity that Modi and BJP have put the poor of India through in the last 2 months.

The so-called "package" also talks about disinvestment of Public enterprises. Even the profitable ones. This is another step by BJP to strengthen its business-support group. They already paid back Ambani with favorable regulatory stances to help establish Jio at the cost of other telecom giants. The next in line seems to be the big Oil and manufacturing PSU's. Get ready to see another round of lucrative acquisitions by the private sector in the form of prime locations and factories at cheap prices.
 
This "Package" is a Joke on the poor and the salaried middle classes who will pay for it by taxes.

Better such a package than none at all. It's not much, but it's something. India is still not the richest country and I believe that in the current situation this is not a small amount of money for them.
In addition, in comparison with the same US - situation in  India is much better (1,897,380 infected against 236,184 in India / 109,132 deaths against 6,649 in India)

Your post makes me wonder about a lot of things. Does India have any social protection fund or welfare for unemployed people? For example, when employees signed under contract with companies, there is usually a clause of unforeseen situations where the company must halt their works, they could pay their employees with salary-but-off-work (amount of salary is negotiable between employees and companies when such thing happen). This is just a temporary way to keep employees not completely out of company and also help them have a workforce ready when the situation back to normal (usually for a few months). If not, then do workers pay some kind of tax that when they become unemployed, they could apply to receive some benefit. Although not much, just enough to keep them afloat to looking for a new job.

This is normally how I see from the workplace so aid package should aim toward 1) company and 2) unemployed. Low interest loan ain't going to help much especially only aim at the company when thing hasn't back to normal while unemployed still have mouths to feed.

Yes, that's exactly my point, as much as government really wanted to help everyone, most of the time, they don't have a choice. Of course, if you are rich, you could get some favours, and we can't really deny that. I think it is already part of the system. But I will say that it is unacceptable, but with the recent crisis, governments or banks will have to prioritise, in my opinion.

Not really, governments are simply printing money to tackle the condition but they are not willing to save everyone they just care for the one who is rich and this is happening on many parts of the world.Governments are trying to help the owner because they are the one who pays more taxes to the government but they forget that every employer is also a citizen/consumer so they are literally paying taxes for everything which is even more than rich individuals.

I agree with you op. What also can you expect from someone like Modi? He is easily one of the worst world leaders I have seen in recent times. Even Trump is better in comparison in certain aspects in my opinion.

It baffles me as to how he got re-elected with most votes in his favor. Almost every single decision that he made was bad for the country on the whole(GST, Demonetization etc) in an unplanned manner screwing the common man royally.

Indian unemployment rates are at an ATH currently and its development rate has slowed down drastically. After all this, he now claims that India will emerge stronger from this pandemic when he himself made the situation worse for the country.

Perhaps banks needs to re-assess those who wanted to get a loan and perhaps the pen factory is not on the list of priorities that's why they offer a cheap loan? And with the government's and banks limited budget, I think not only in India that you can see this, as well as other parts of the globe as well.

This is really sad though as a lot of small business are really closing down because of the effect but the hands of the government are really tied at this point. I'm not siding with the government or bank here, but they can't do everything to help everyone.

People might expected direct stimulus like what America did to its citizens. And I see this as poor management or leadership because when there is no demand for the products in the whole world then were the manufactured products gets to sell?

Don't rely on governments, and don't trust their fake promises we need decentralization and bitcoin is the first step towards it.

Perhaps a last-minute saving-face decision would do the trick, although we know that Modi for the most part have some things in mind other than the welfare of his own people. Reducing the amount of interest from loans ain't gonna cut it knowing that a huge portion of the Indian population is not really receiving any salaries or profits from their business. It might not be as grand as the stimulus package of the US and other domestic aids from other countries but at least try to show the people that you care and you are willing to help--but that's not the case in here, sadly. I applaud the police force of India on imposing the quarantine guidelines and safety measures, but on how the admin is handling economic matters and public welfare, it's a no for me.

Many countries do semi-herd immunity, they reopen the economy even though the corona pandemic has not even reached its culmination point. Economic factors and the lack of clarity about the end of the pandemic and the discovery of anti-virus are the main economic openings to reduce the risk of acute depression and chronic depression.

A brief lockdown has at least provided direct and indirect education for the public about the dangers of corona and its effects both on health and on social and economic life. With the provision of education during the lockdown, the government hopes that the economic opening policy in the midst of a pandemic is one of the middle solutions between the economy and humanity. A series of corona norms are applied such as requiring the use of masks outside the home, the habit of frequent hand washing, limiting the number of group activities, and the use of hand sanitizers. This semi-herd immunity policy makes the choice in the hands of people want to be healthy or want to go to the cemetery.

But still government is tackling it in in much better way UPSers

I don't know anything about how the government in India is handling the current situation, but there are two sides to it. Since employees don't make loans, they are not obliged to pay it, which is good because they have no income as of the moment. But I think it will also be hard for the part of the entities knowing that they also have no operation and revenue, but they will have to make a loan for their employees.

It's fine than having no help at all, but it would be better if the government can provide better assistance, not just loans. India may not be a rich country like others but I think they can still provide some help for their citizens who lost their jobs due to the pandemic. Maybe they also helped in other ways, their citizen can judge their government's performance since they are the one who knows it very well. But personally, I don't think a loan is a good help because it might help you with the current situation but you will have to bring it in the future and pay for it.

The story (situation in India) is not a tragedy Imo, if Alex was given the loan directly, he will sooner or later exhaust it and come asking for another loan, maybe from a different person and in no distant time, Alex will have huge debts to pay, with no work to do to earn money to pay his debts. But if the loan is given to Alex's place of work, then Alex can be placed back on a fixed income, while the company covers the loans; Alex then has his job back and the company is also up and running.

So if this is the idea the government is coming up with in India, then it's not a bad one. If this funds are distributed individually, the economy will likely not recover at a fast pace, but if loans are granted to small and large scale businesses, factories, companies etc to start business as usual, people will have their jobs back, their employers will start making money and there will be cash flow into the economy.

Its a mess for sure, its done in a hurry-bury sort of thing. Not surprised, given everything happening around us. But I do think, given the situation, a loan is somewhat better than a plain subsidy. From what I have read, and studied about the Indian local community, subsidies are usually granted in very less amounts, in actual USD conversion, a subsidy per household averages from 15-30$. And that's so less. But giving an opportunity for loans, while also increasing its availability, will help for the cash to flow throughout the economy.

While people need direct help, its not quite possible. Everything is going to end up in a turmoil, if money is just given out like that, especially for a country that is still struggling to develop. If people are smart, they'll make good use of the ease of getting loans, and work it around for their business.

Or better yet, they have to find other options to save themselves from starvation. It is true that the government should provide them some kind of assistance but they should not totally rely from that as they don't know in what form or when will it be received. So while waiting, I think they need to find alternatives on how to support themselves. And this situation is not only happening on their country but around the globe. So it is not an isolated case for them. Not all people across the globe can receive benefit from their government but they are also affected by this pandemic. If all people will complain, I guess we will hear a lot of them. Find other ways to support yourself.

What I'm thinking is that no matter how ridiculous it could look, it is better than not giving out anything. India is not really very much a country with strong economy, they are still depending on other countries for support and also classified as third world countries. So if there government is making a little help on the masses, is better appreciated.

Just my own, people in India might see it as a laughing stock due to a lack of information on how it will be distributed to all the sectors of their economy including the citizen. If it will be distributed or lend it to businesses then it has an indirect impact on every individual in India but if it will be given as a relief good or amelioration to every citizen obviously, it will provide a direct impact.

Either of the two will still serve and aim for a good and at the end of the day, it will be the citizens who will still benefit on this because I am pretty sure that the prime minister will not give out such information about the 263$ billion if it is not true.

If Modi didn't say on where or how it will be used then might as well they could ask their government about it instead of making it as a laughing stock while they will just little by little die in starvation.

The Indian government is doing a poor job in handling the corona virus cases, today itself the cases touched 200,000 and they are opening the lock-down, this is bizarre.
They should have implemented the lock-down for more time until the new cases gets reduced, also they should helped the citizens by helping them with a support package and not a loan package which they have done now. I like the US much than Indian government where they introduced stimulus cheque for the poor and needy so that they don't starve to death, there have been many reports in India about more people dying from hunger rather than corona virus itself.

I'm not familiar with the national budget of India.
Is the Indian government capable of spending billions of US dollars,in order to help the poor people in one of the biggest and most populated countries in the world?
Can the Indian government increase the national debt of India,in order to provide such financial help?
Do you think that the Indian central bank should start printing money and give loans to the government,which will cause inflation?
I agree that cheap loans are not a solution,but the government has a budget and increasing the budget deficit will cause more problems in the future. 

The reality in unfortunately far more terrifying.

People actually cannot get free and discounted food from the government if they did not register for the card . ( It is for people below the poverty line) , unfortunately some middle class people have also abused this and using it for their own profits.

My family was helping out a poor woman who did not have a card and could not afford and on going to the office they told her to come again with the card. Where is she going to apply during quarantine?
( Good thing , some underhanded methods made it so she can get food )

This bill by Modi is a laughing stock .
People don't have jobs since years and right now they are suffering every single day. The government is not even able to keep track of the people dying.

They don't even keep track of the bills hospitals are asking people to pay. Around 100$ per day is prescribed , reality is people are paying 400$ a day . If they are not doing it , they aren't getting a bed or prescription in the hospital.

All of this which is said in the news is actually not even close to the reality.

Then again governments are more interested in fighting at this time. One needs a good advisor for the country as a whole. But it is already too late.

The indeed sent out financial helps to a certain segment of the population. Do you know the amount? It's 500 INR which is 6.65 USD as on today's rate. A decent meal in an average Indian restaurant usually costs twice as much. So you can understand what 500 INR can do as financial help! It's a joke!

There is a chance of inflation but with more and more people loosing their job, the market is already suffering from the lack of liquidity. Unless and until people get to spend money, the entire financial help makes no sense!

India was progressing well until the current leaders came in. The current ruling party of India is based on religious beliefs and majority of their ministers are either uneducated or expert is spreading communal hatred.

This idea would be practical if the nation has a very efficient Health Care system to be able to stay above the curve. The virus has a low fatality rate should the cases be attended to, but a rapid spread rate. In a situation where there are more patients than the health system can admit then the death rate tends to go higher. India has a very high population and the the virus can spread easily there.

On the flip side nations can't remain closed indefinitely pending a vaccine. Nations have to be opened up, but this should be done with caution and only relevant sectors should be allowed to, while following health guidelines. Funds can also be diverted to the purchase of PPEs.
Herd immunity could also be achieved after a while.

The MoF must be having a terrible headache at the moment lol. I think whatever they can do is limited since we are dealing with a severe economic shutdown. I have this idea about letting people free as before, but instead of giving incentives to boost the demand, the money can be used to guarantee 100% medical treatment if someone becomes infected. So get out and work! Don't be afraid! And even if you get sick because of it, we will give you free treatment.

This article reports that India distributed about $22.5bn in food supplies and cash transfer to vulnerable families last month. It was billed to have reached up to 800 million people.
Also, If the loan packages can be distributed to SMEs then it could reach the grassroot of the nation, thereby touching more lives and this would equally help boost spending and support the economy.

Governments also have to regulate the money flow to prevent inflation.
I made a reply few days ago on how giving out loans to small, unsustainable businesses is going to affect the UK as statistics shows there would be lots of defaulters.

Maybe it is too hasty for you to conclude that no help is coming whether direct or not, for such amount to be put out to support in this covid-19 lockdown. If food is not distributed directly, government might give money to small businesses to flourishing again and with that many families can benefit. It is a hard time for government and they would want to restart the economy by encouraging more employment and not to share everything in food stuffs. Be patient with your government.

Financial assistance is often in the event that the state fears a recession and thus encourages public sectors to continue spending.
Companies are the lifeblood of many economic activities, and therefore the government supports them to continue to pay salaries to them and thus move economic life.
Direct support to individuals will be good after checking the indicators above, but do not forget the huge number of citizens in India, which makes the incentives issued may be few compared to others.


I think that there was some support for the poor segments, I remember that in March a number of economic relief measures were announced to the poor totaling more than 24 billion US dollars + a free food grains package.

I don’t know how the government’s decision was implemented, but I think the economic data coming from India is very reassuring.

India, under the leadership of Modi has recently announced a financial package to help all segments of people in the country. The approximate value of the package is 263 billion USD and people are laughing at it. Modi has again proved himself unworthy of leadership because there's no direct help offered to any segment of people. He has just made a lot of loans available for all. Let me summarize the entire scenario with a beautiful story. The author of the story is unknown.

The story:
My neighbor Alex works for a pen factory. One fine morning, he came knocking my door. After few pleasantries, he asked for monetary help as his factory is closed for last 2 months due to the COVID induced lockdown and he was not paid his salaries. So he asked for some money so that he can feed his family. After listening, I requested him to come after 2 days and promised that I will arrange something for him.

After 2 days, Alex again came knocking my door. Today I offered him a cup of coffee and after few pleasantries I told him that, I have had a discussion with the local bank manager and arranged for a loan of $100,000 for his pen factory owner. So I asked him to speak to his pen factory owner so that the owner can get the loan from the local bank to resume his production and send the manufactured pen to the market. Once the pens are sold, the owner can then pay the installments of the loan and also pay the salaries of the employees.

Alex fainted!

My conclusion: The entire package doesn't talk about any direct help for the people. It only talks about cheaper loan availability to the industries. A classic example of directionless leadership.

What do you think?