India announces $264bn economic rescue package


India has announced a 20 trillion rupee ($264bn; £216bn) economic package to help the country cope with its prolonged coronavirus lockdown.

In a televised address Prime Minister Narendra Modi said the measures would support farmers and small businesses.

Finance Minister Nirmala Sitharaman is due to announce further details in the next few days.

India has more than 70,000 cases among its 1.3bn population and is expected to pass China’s numbers within a week.

Mr Modi said the package, which is equivalent to 10% of India’s gross domestic product, aimed to help people who have lost their jobs and businesses hit by the shutdown.

“The package will also focus on land, labour, liquidity and laws. It will cater to various sections including cottage industry, medium and small enterprises, labourers, middle class, industries, among others,” he said.

He also said that strict stay-at-home orders would be extended beyond 17 May with a new set of rules.

The country’s very strict lockdown, which started on 25 March, has had a huge economic impact, with tens of millions of poorer Indians and migrant workers hit hardest.

In March, India said it would provide around 1.7 trillion rupees in direct cash transfers and food security measures, mainly for the poor.

However, Mr Modi’s administration had been accused in some quarters of not having done enough.

It comes as governments and central banks in other countries around the world have provided unprecedented levels of support for their economies to tackle the crisis.

“India’s response has so far been tepid compared to other key nations and thus the catch-up is welcome and is also the need of the hour,” said economist Madhavi Arora at Edelweiss FX and Rates.

“It needs to be seen how much will be in the form of direct budgetary support to gauge the immediate fiscal hit and the consequent funding sources,” he added.

Source: BBC


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