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The <keyword id="151047" type="General" weightage="20" keywordseo="Rural-development-ministry" source="Orion">rural development ministry</keyword> has sought additional funds of about Rs 25,000 crore for the <keyword id="145241" type="General" weightage="20" keywordseo="MGNREGS" source="Orion">MGNREGS</keyword>, in a clear indication of a rise in demand for work, sources said on Tuesday. The ministry has sought Rs 25,000 crore from the finance ministry and it is expected that the funds will be allocated by the second week of this month, the sources said. In the <keyword id="6360189" type="General" weightage="80" keywordseo="union-budget" source="Orion">Union Budget</keyword> for 2022-23, an amount of Rs 73,000 crore was allocated for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). Of this amount, about Rs 54,000 crore have been allocated to the states so far, the sources said. About 181 crore person days of work has also been generated under the programme so far, they added. The total expenditure on the MGNREGS is expected to touch the last financial year's level of Rs 98,000 crore. The government would take Parliament's approval for the additional fund allocation under the MNREGA through the first batch of the Supplementary <keyword id="15401700" type="TOPIC" weightage="60" keywordseo="Demands-for-Grants" source="TOPIC" sourcekeytype="budget,investopedia" meta.keywordsubtype="null" meta.seopath="d/demands-for-grants" meta.entityname="Demands for Grants" meta.hostid="153" meta.entityid="demands-for-grants">Demands for Grants</keyword> to be tabled in the upcoming winter session. The MGNREGS aims at enhancing the livelihood security of households in the rural areas of the country by providing at least 100 days of guaranteed wage employment in a financial year to every household, the adult members of which volunteer to do unskilled manual work. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/gst-collections-touch-151718-cr-in-oct-second-highest-since-april/articleshow/95225501.cms">GST collections touch ₹1,51,718 cr in Oct, second highest since April</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/international/news/pakistans-forex-reserves-are-close-to-nil-says-local-newspaper-dawn/articleshow/95224526.cms">Pakistan's forex reserves are close to nil, says local newspaper Dawn</a>

Rural development ministry seeks additional funds of ₹25,000 crore for MGNREGS

The <keyword id="6354477" type="PERSON" weightage="100" keywordseo="Narendra-Modi">Narendra Modi</keyword> government has decided, and is all set to achieve, the targets for the next two years regarding the Mahatma Gandhi National Rural Employment Generation Scheme (<keyword id="145241" type="ORGANIZATION" weightage="100" keywordseo="MGNREGS">MGNREGS</keyword>). Reportedly, these targets are bigger than what the scheme has accomplished in the last 10 years. 
 
As per the plans, the rural development ministry would be adding 1 million farm ponds and wells and another million vermi composting farms under the programme. This figure is almost equal to the total such assets the scheme has as of now, created in the past decade by the UPA government. The coming budget would help sharpening focus on rural sector schemes in a big way. 
 
Out of the Rs 75,000 crore that was allocated, the rural development ministry has utilised more than 90% in the past 10 years. This budget is now expected to be doubled this year, because of the expansion of development schemes, including the rural jobs programme. 
 
"NREGS has a crucial role to play now since we are converging it with all our other schemes. Having utilised most of our funds, we need to continue to create more assets and multiple opportunities for livelihood for the rural poor," a senior rural development ministry official told ET. 
 
By creating farm ponds and dug wells, the government aims to make NREGS a green scheme, and greater push would be given to agriculture and irrigation-related activities. 
 
The government wants to achieve breakthroughs in assured irrigation in areas where rain decides the fate of the crop as well as the areas where ground water is available. 
 
Along with state agricultural departments, the rural development and agriculture ministries have coordinated so that NREGS can be used to boost multitier cropping and generate livelihood through farming. The animal husbandry department is also collaborating on NREGS so that poultry and goat sheds can be constructed in villages. 
 
The government is also making sure that the workers get their payments on time, as delayed payments have been slashed by 72% and it is further aimed to be brought down to single digits by June this year. 
 
However, PM Modi has not always been a fan of the scheme, having called it an example of six decades of failure by the Congress. One could think that these targets are just a smart way of the Modi government to dismantle the MGNREGS scheme altogether.

Is Modi trying to dismantle MGNREGS by setting
an overtly high asset target?

New Delhi, <keyword id="3658" type="LOCATION" weightage="20" keywordseo="India">India</keyword> has been witnessing a 'V-shaped' recovery since June with the gradual easing of <keyword id="6413318" type="UNKNOWN" weightage="20" keywordseo="Restrictions">restrictions</keyword> on economic activities, said a <keyword id="47209" type="COMPANY" weightage="20" keywordseo="Finance-Ministry">Finance Ministry</keyword> report. "The sustained improvement in high frequency indicators ignite optimism of an improved performance in second half of the year," it said. The Monthly Economic Recovery for December by the <keyword id="144110" type="COMPANY" weightage="20" keywordseo="Department-of-Economic-Affairs">Department of Economic Affairs</keyword> (DEA) also noted that the impending vaccination is set to spur the momentum in economic activity globally. "The effective management of Covid-19 spread despite the festive season and onset of winter season, combined with sustained improvement in high frequency indicators and V-shaped recovery along with easing of lockdown restrictions distinguish Indian economy as one riding against the Covid-wave," it said. The agricultural sector remains the bright spot of Indian economy, with healthy year-on-year growth of 2.9% in rabi sowing, accelerating <keyword id="138831" type="PERSON" weightage="20" keywordseo="tractor-sales">tractor sales</keyword>, and reservoirs' live storage at 122% of decadal average. As per the DEA report, rise in minimum support prices accompanied by record procurement, and accelerated wage employment generation through MGNREGS, bodes well for rural incomes and bears testimony to PMGKY's success in alleviating rural distress. "This rise in rural incomes is mirrored in the healthy, though moderated, sales in passenger vehicles, two and three wheelers and tractor, and a rebound in vehicle registrations for the first time after March 2020," it added. Further, the industrial production growth ran parallel to the festive fervour of October and rose to an eight-month high, led by manufacturing and <keyword id="1207963" type="PERSON" weightage="20" keywordseo="electricity-sector">electricity sector</keyword>. The core industries registered slight decline in November driven by natural gas and cement, while coal production, electricity and fertilizers' production registered growth. SEE ALSO: <a href="https://www.businessinsider.in/india/news/tatas-got-airasia-stake-at-a-20-discount-while-indigo-and-spicejets-value-has-doubled-since-pandemic-broke-out/articleshow/80101467.cms">Tatas got AirAsia stake at a 20% discount while IndiGo and SpiceJet’s value has doubled since pandemic broke out</a> <a href="https://www.businessinsider.in/india/news/bharat-biotech-sees-rivals-conspiracy-in-all-the-criticism-for-the-approval-for-covaxin/articleshow/80099818.cms">Bharat Biotech sees rivals’ conspiracy in all the criticism for the approval for Covaxin</a> <a href="https://www.businessinsider.in/tech/mobile/news/xiaomi-mi-10i-mobile-with-108mp-primary-camera-snapdragon-750g-launched-in-india-starting-at-20999/articleshow/80111586.cms">Xiaomi Mi 10i with 108MP primary camera, Snapdragon 750G launched in India starting at ₹20,999</a>

India's V-shaped recovery since June has been led by the agricultural sector, claims government

New Delhi, May 26 () Finance Minister Nirmala Sitharaman has called the meeting of the Financial Stability and Development Council (FSDC) on Thursday, which among other things will discuss the impact of COVID-19 on the financial sector and the economy. This will be the first meeting of the FSDC, which comprises RBI Governor and other financial sector regulators, after the outbreak of the coronavirus. The FSDC meeting, to be chaired by the finance minister, will held via video conferencing, sources said. The meeting will take place in the backdrop of India staring at the risk of contraction in growth during the fiscal due to the COVID-19 crisis. Besides the RBI Governor, the members of the FSDC include chairmen of the Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India and Pension Fund Regulatory and Development Authority. The senior officials of the finance ministry will also attend the meeting. The council is expected to review various aspects associated with the mega Rs 21 lakh crore stimulus package announced by the government to help the nation tide over the economic crisis induced by the coronavirus and subsequent lockdown to curb its spread. Earlier this month, the government announced a staggering Rs 20.97 lakh crore economic package, which includes Reserve Bank's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had announced this economic package in five tranches, which included a Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies, free foodgrains to migrant workers, increased allocation for MGNREGS, tax relief to certain sections and Rs 15,000 crore allocated to the healthcare sector to deal with the pandemic. According to sources, various measures announced by the Reserve Bank of India since February and its impact on boosting economy and sentiment will also be deliberated during the FSDC meeting. The RBI last week said the impact of COVID-19 is more severe than anticipated and the GDP growth during 2020-21 is likely to remain in the negative territory. It projected some pick-up in growth impulses from second half (October-March) of 2020-21 onwards. DP CS MKJ

FSDC meeting on Thursday, to discuss impact of COVID on economy

New Delhi, Jan 17 () Progress across major development schemes in India, including education, health and nutrition among others, remains constrained due to sub-optimal utilisation of available funds, especially at the district level, according to a recent study by Tata Trust.
The study by Tata Trust and Centre for Budget and Governance Accountability (CBGA) stressed that India needs to improve utilisation of budgetary resources, across all levels of governance, given the limited fiscal space available to the government.
"Progress across major development schemes in India, including education, health and nutrition, water and sanitation, agriculture and rural development, livelihood, among others, remains constrained due to sub-optimal utilisation of available funds, especially at the district level," Tata Trust said in a statement.
According to statement, pressing challenges related to staff shortages, their capacity, transparency and
accountability in public financial management, monitoring have not received adequate attention.
"These need to be addressed urgently. There are also concerns with respect to the quality in fund utilisation across schemes," it said.
The 2-year study focused on ten social sector schemes including Sarva Shikshya Abhiyan (SSA), Mid-Day Meal (MDM), National Health Mission (NHM), Integrated Child Development Scheme (ICDS) and Swachh Bharat Mission (SBM).
 Other schemes included National Rural Drinking Water Programme (NRDWP), Mahatma Gandhi National Rural Employement Guarantee Scheme (MGNREGS), National Social Assistance Programme (NSAP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Fasal Bima Yojana (PMFBY) and Rashtriya Krishi Vikas Yojana (RKVY) in five districts across of Balasore and Bolangir in Odisha, Chandrapur in Maharashtra, East Singhbhum in Jharkhand, and Krishna in Andhra Pradesh. BKS MKJ

Progress of top development schemes remains constrained in India: Study

New Delhi, May 27 () Finance Minister Nirmala Sitharaman has called a meeting of the Financial Stability and Development Council (FSDC) on Thursday, which among other things will discuss the impact of COVID-19 on the financial sector and the economy. This will be the first meeting of FSDC, which comprises RBI Governor and other financial sector regulators, since the outbreak of coronavirus. The FSDC meeting, to be chaired by the finance minister, will be held via video conference, sources said. The meeting will take place against the backdrop of India staring at the risk of contraction in the economy during the current financial year due to the COVID-19 crisis. This would be the third meeting of FSDC after the Modi 2.0 government assumed office. Besides the RBI Governor, the members of FSDC include chairpersons of the Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India and Pension Fund Regulatory and Development Authority. Senior officials of the finance ministry will also attend the meeting. The council is expected to review various aspects associated with the Rs 21 lakh crore stimulus package announced by the government on May 12 to help the nation tide over the economic crisis induced by the coronavirus and the lockdown to curb its spread. The mega economic package includes the Reserve Bank's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had announced this economic package in five tranches, which included a Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies. Besides, free foodgrains to migrant workers, increased allocation for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), tax relief to certain sections and Rs 15,000 crore allocation to the healthcare sector to deal with the pandemic, were also announced as part of the economic package . According to sources, various measures announced by the Reserve Bank of India since February and its impact on boosting the economy and sentiment will also be deliberated during the FSDC meeting. The RBI last week said the impact of COVID-19 is more severe than anticipated and the GDP growth during the current financial year is likely to remain in the negative territory. It projected some pick-up in growth impulses from the second half (October-March) of 2020-21 onwards. On Tuesday, rating agencies Fitch and Crisil drastically cut India's economic growth forecast for the current fiscal year due to a prolonged lockdown. Fitch forecast 5 per cent contraction in 2020-21, a sharp decline from 0.8 per cent growth projected by the global rating agency in late April. Crisil also predicted the economy to shrink by 5 per cent in the current fiscal. Earlier, it projected a growth of 1.8 per cent. The first case of coronavirus in India was detected in late January. DP CS ANU

FSDC meeting on Thursday, to discuss impact of COVID-19 on economy

New Delhi, May 28 () Finance Minister Nirmala Sitharaman on Thursday reviewed the state of the economy at the meeting of the Financial Stability and Development Council (FSDC), in view of disruptions caused by the COVID-19 pandemic. This was the first meeting of the FSDC, which comprises RBI Governor and other financial sector regulators, since the coronavirus outbreak. The 22nd meeting of the FSDC, which was held via video conferencing, assumes a greater significance considering that the economy is expected to contract by 5 per cent by some estimates amid the virus crisis. Various measures to maintain financial stability in the context of COVID-19 have been reviewed, an official said after the meeting. The meeting also took note of the activities undertaken by the FSDC Sub-Committee chaired by RBI Governor Shaktikanta Das and the initiatives taken by the various regulators in the financial sector. The FSDC is the apex body of sectoral regulators, headed by the finance minister. Besides the RBI governor, SEBI chief Ajay Tyagi, IRDAI chairman Subhash Chandra Khuntia, Insolvency and Bankruptcy Board of India (IBBI) chairman M S Sahoo and PFRDAI chairman Supratim Bandyopadhyay were present in the meeting. Economic Affairs Secretary Tarun Bajaj, Revenue Secretary Ajay Bhushan Pandey, Financial Services Secretary Debasish Panda and other top officials of the finance ministry also attended the meeting. This was be the third meeting of the FSDC after the Narendra Modi government returned for the second term in May last year. The RBI last week said the impact of COVID-19 is more severe than anticipated and the GDP growth during the current financial year is likely to remain in the negative territory. It projected some pick-up in growth impulses from the second half (October-March) of 2020-21 onwards. On Tuesday, rating agencies Fitch and Crisil drastically cut India's economic growth forecast for the current fiscal year due to a prolonged lockdown. Fitch forecast 5 per cent contraction in 2020-21, a sharp decline from 0.8 per cent growth projected by the global rating agency in late April. Crisil also predicted the economy to shrink by 5 per cent in the current fiscal. Earlier, it projected a growth of 1.8 per cent. Earlier this month, the government announced about Rs 21 lakh crore stimulus package to help the nation tide over the economic crisis induced by the coronavirus and the lockdown to curb its spread. The mega economic package includes the Reserve Bank's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had announced this economic package in five tranches, which included a Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies. Besides, free foodgrains to migrant workers, increased allocation for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), tax relief to certain sections and Rs 15,000 crore allocation to the healthcare sector to deal with the pandemic, were also announced as part of the economic package. DP MKJ

FM chairs FSDC meeting, takes stock of economy amid COVID-19

New Delhi, May 23 () A day after the RBI projected economic contraction in 2020-21, Finance Minister Nirmala Sitharaman on Saturday said future fiscal policy actions to stimulate the economy will depend on how COVID-19 pandemic pans out. The government has already announced a Rs 20.97 lakh crore economic package, which includes Reserve Bank's Rs 8.01 lakh crore worth of liquidity measures till May 17. Sitharaman said making a "realistic assessment" of economic growth would be difficult at this point of time as there is no clarity on when the pandemic would retreat. "I'm not closing the door at all. I want to keep getting inputs from industry, implement what we have announced and depending on how things pan out we have to respond accordingly. We are only 2-month old in this year, we have 10 months to go," Sitharaman said in a conversation with BJP leader Nalin Kohli. The Reserve Bank on Friday had said the impact of COVID-19 is more severe than anticipated and the GDP growth during 2020-21 is likely to remain in the negative territory. It projected some pick-up in growth impulses from second half (October-March) of 2020-21 onwards. Last week, the minister had announced an economic packages five tranches, which included a Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for Power distribution companies, free foodgrains to migrant workers, increased allocation for MGNREGS, tax relief to certain sections and Rs 15,000 crore allocated to the healthcare sector to deal with the pandemic. The package was done in consultation with economists, academicians, ex-bankers, ex-finance ministry officials and industry, Sitharaman said, adding the idea was to make available more liquidity in the economy and revive demand, Sitharaman said. "The package was designed keeping in mind that we are facing a situation which is exceptional and therefore whether the contraction is going to be this much or that much, we didn't have the luxury of data to guess-estimating them. However, the spirit of that thought has been kept in mind that we have to now look at complete contraction and if we have to stimulate the economy keeping that in mind what is that we have to do," she said. Sitharaman said the approach has been to go through this route of stimulating the economy through companies, institutions, enterprises and businesses all getting assistance by banks or formulations through which businesses restart. "I'm sure the Indian entrepreneurs are also going to come out after they test the waters post the lockdown...We have come with measures which will get more liquidity in the economy, if there is more liquidity in economy people will get money in their hands and that will kick-start economy, bring more demand," she said. Sitharaman further said that the government is working to further speed up FDI clearances by administrative departments, providing policy certainty and easing compliance burden for companies. COVID-19, the disease caused by coronavirus, has claimed 3,720 lives in India while the number of infected stood at over 1.25 lakh. JD DP MKJ

Future actions to stimulate economy will depend on how COVID crisis pans out: FM

New Delhi, Apr 19 () More than Rs 36,659 crore has been transferred to the bank accounts of 16.01 crore beneficiaries using direct benefit transfer (DBT) between March 24 and April 17 during the lockdown, the finance ministry said on Sunday. The cash amount has been transferred by using Controller General of Accounts' (CGA) digital payments technology Public Financial Management System (PFMS) under Central Schemes (CS) and Centrally Sponsored Schemes (CSS). DBT ensures that the cash benefit is directly credited into the account of the beneficiary, eliminates leakage and improves efficiency. "More than Rs 36,659 crore has been transferred by using Direct Benefit Transfer (DBT) through the Public Financial Management System (PFMS) in the bank accounts of 16.01 crore beneficiaries by the Controller General of Accounts (CGA) office during COVID-19 lockdown," the ministry said in a statement. Of the Rs 36,659 crore, Rs 27,442 crore has been transferred under CSS and CS and Rs 9,717 by various state governments for its welfare schemes. Between March 24 and April 17, the DBT payments under all the central sector/centrally sponsored schemes through PFMS amounted to Rs 27,442.08 crore in the accounts of 11.42 crore beneficiaries through schemes like PM-KISAN, Mahatma Gandhi National Employment Guarantee Scheme (MGNREGS), National Social Assistance Program (NSAP), Prime Minster's Matru Vandana Yojana (PMMVY), National Rural Livelihood Mission (NRLM), National Health Mission (NHM), scholarship schemes of various ministries through the National Scholarship Portal (NSP). Besides, states like UP, Bihar, Madhya Pradesh, Tripura, Maharashtra, Jammu &amp; Kashmir, Andhra Pradesh have used DBT to transfer cash in the bank accounts. Through 180 welfare schemes, the state governments using PFMS have disbursed to 4.59 crore beneficiaries, an amount of Rs 9,217.22 crore between March 24 and April 17. Apart from above mentioned schemes, payments were also made under the PM Garib Kalyan Yojana, Rs 500 was credited in the women account holder of Jan Dhan accounts. Till April 13, the total number of women beneficiaries stood at 19.86 crore, which resulted in disbursement of Rs 9,930 crore. A total of Rs 17,733 crore has been paid under PM-KISAN to 8.43 crore beneficiaries, while Rs 5,406 crore has been disbursed under MGNREGA to over 1.55 crore bank accounts. The ministry said PFMS usage for DBT payments increased over last three financial years with total amount disbursed through DBT increasing from 22 per cent in 2018-19 to 45 per cent in 2019-20. With effect from April 1, 2015, the finance ministry had made it mandatory to use PFMS for payment, accounting and reporting under DBT and directed all implementing ministries or departments to ensure that no payments under DBT schemes were processed unless the electronic payment files for such payments were received through PFMS. JD HRS

Rs 36,659 cr transferred to 16 cr beneficiaries using DBT during COVID-19 lockdown

(Eds: Adding details) New Delhi, May 28 () Finance Minister Nirmala Sitharaman on Thursday reviewed the state of the economy at the meeting of the Financial Stability and Development Council (FSDC), in view of disruptions caused by the COVID-19 pandemic. This was the first meeting of the FSDC, the apex body of sectoral regulators headed by the finance minister, since the coronavirus outbreak. The 22nd meeting of the council, held via video conferencing, assumes a greater significance considering that the economy is expected to contract by 5 per cent by some estimates amid the virus crisis. The FSDC, which also comprises RBI Governor and other financial sector regulators, underlined the need to continue with measures to address the liquidity and capital requirements of the financial sector. Among the issues discussed were: the current global and domestic macro-economic situation; financial stability and vulnerabilities; challenges likely to be faced by banks and other financial institutions; regulatory and policy responses; solvency matters of financial firms, etc, according to a finance ministry statement. Besides, market volatility, domestic resource mobilisation and capital flows issues were also discussed by the council, it said. The council noted that the COVID-19 pandemic crisis poses a serious threat to the stability of the global financial system as the ultimate impact of the crisis and the timing of recovery is uncertain at this point of time, it said."While, decisive monetary and fiscal policy actions aimed at containing the fallout from the pandemic have stabilised investor sentiment in the short-run, there is a need to keep a continuous vigil by the government and all regulators on the financial conditions that could expose financial vulnerabilities in the medium and long-term," the ministry said. The statement further said that the efforts of the government and regulators are focused on avoiding a prolonged period of dislocation in financial markets. The RBI last week said the impact of COVID-19 is more severe than anticipated and the GDP growth during the current financial year is likely to remain in the negative territory. It projected some pick-up in growth impulses from the second half (October-March) of 2020-21 onwards. The council also reviewed the action taken by members on the decision taken by the FSDC earlier. The council took note of the initiatives taken by the government and the regulators in the recent months to help revive the economy. The government and the RBI have announced various fiscal and monetary measures to pre-emptively limit the economic damage and would continue to address the liquidity and capital requirements of the financial institutions. Earlier this month, the government announced about Rs 21 lakh crore stimulus package to help the nation tide over the economic crisis induced by the coronavirus and the lockdown to curb its spread. The mega economic package includes the Reserve Bank's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had announced this economic package in five tranches, which included a Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies. Besides, free foodgrains to migrant workers, increased allocation for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), tax relief to certain sections and Rs 15,000 crore allocation to the healthcare sector to deal with the pandemic, were also announced as part of the economic package. Besides the RBI governor, SEBI chief Ajay Tyagi, IRDAI chairman Subhash Chandra Khuntia, Insolvency and Bankruptcy Board of India (IBBI) chairman M S Sahoo and PFRDAI chairman Supratim Bandyopadhyay were present in the meeting. Economic Affairs Secretary Tarun Bajaj, Revenue Secretary Ajay Bhushan Pandey, Financial Services Secretary Debasish Panda and other top officials of the finance ministry also attended the meeting. DP MKJ

FM chairs FSDC meeting, takes stock of economy amid COVID-19 crisis

By Bijay Kumar Singh New Delhi, May 28 () Former Reserve Bank Governor Bimal Jalan on Thursday described the initiatives taken by the government to mitigate the impact of COVID-19 as "very positive" and hoped that these would help in containing the decline in growth. He further said that unlike in 1991, when the country faced a balance of payments crisis, today India has resources as well as forex reserves to deal with any eventuality. "All the measures announced by her (Finance Minister Nirmala Sitharaman) are very positive. "But as you have rightly said these are all supply side, not demand side. In terms of the economy, one does not expect higher fiscal deficit to lead to a higher economic growth in macroeconomic sense," Jalan told in an interview. Earlier this month, the government announced a Rs 20.97 lakh crore economic package, which included RBI's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had unveiled the package in five tranches, which included Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies, free foodgrains to migrant workers, increased allocation for MGNREGS, tax relief to certain sections and Rs 15,000 crore allocated to the healthcare sector. On criticism that India's economic package was too less compared to packages unveiled by countries like the US and UK, he said developed and developing nations are very different. "If you look up at developed countries, I mean their rate of growth is say 2 per cent or 3 per cent and they have a large per capita income and so on. "For developing countries' point of view, you want a high rate of growth, say at least 6 per cent or 7 per cent, and you also want inflation to be under control so that per capita income increases," Jalan noted. Asked if India's present economic crisis is as big as the 1991 balance of payment crisis, he said, "The 1991 economic crisis was very different, we had a balance of payment problem of a very deep kind. We did not have sufficient forex reserves." "Today we have resources and high forex reserves," Jalan, also a former member of Parliament, pointed out. So the current circumstances are very different from 1991, he said, adding, "Today we have the ability to do what we want to do." On whether he supports monetisation of deficit by the central bank, the former RBI governor said it is not a question of support or non-support as it depends on the situation. "In particular circumstances, you can monetise, in other circumstances, you give liquidity to the market and liquidity for the borrowers," he opined. Monetisation is loosely referred to as printing of currency by the central bank for the government to take care of any emergency spending and to bridge the fiscal deficit. On the country's macroeconomic situation, Jalan said growth rate is going to fall significantly. "Last year it was 5.2 per cent, this year estimates vary from minus 1 or minus 2 to 2 per cent at the most. "So economy is more or less static and the impact of whole coronavirus on the economy has been quite negative," he said. Rating agencies like Fitch and Crisil have drastically cut India's economic growth forecast for the current fiscal year due to the coronavirus lockdown. Fitch has estimated 5 per cent contraction in 2020-21, a sharp decline from 0.8 per cent growth projected by the global rating agency in late April. Crisil also predicted the economy will shrink by 5 per cent in the current fiscal. Earlier, it projected a growth of 1.8 per cent. India has seen four instances of contraction in GDP since 1951-52, the earliest period for which GDP data is available in the 2004-05 GDP series. These took place in the fiscals 1957-58, 1965-66, 1972-73 and 1979-80. BKS CS ABM ABM

Govt measures to deal with coronavirus impact 'very positive': Former RBI Guv Jalan

By Bijay Kumar Singh New Delhi, Jun 1 () The 'number one' challenge before the government, once it unlocks the economy amid the COVID-19 crisis, will be to put the financial sector back on its feet, former Niti Aayog Vice-Chairman Arvind Panagariya said on Monday. In an interview to , Panagariya further said that India is facing a health crisis that has led to a sudden stop of the economy. "To restart and return the economy to the pre-COVID-19 path, we need to overcome the health crisis. Once this is done, the main weakness we will need to overcome is the one we had left unsolved prior to COVID-19: disruptions in the financial markets. "Getting the financial sector back on its feet will remain the government's number one challenge once we unlock the economy," he said. The nationwide lockdown was first announced by Prime Minister Narendra Modi on March 24 for 21 days to contain the spread of the novel coronavirus. The lockdown was first extended till May 3 and then again till May 17. It was further extended till May 31 and now has been extended in containment zones till June 30. The home ministry on Saturday said 'Unlock-1' will be initiated in India from June 8 under which restrictions will be relaxed to a great extent, including the opening of shopping malls, restaurants and religious places. Replying to a query on India's current macroeconomic situation, the eminent economist said that once normal functioning of life without masks and social distancing becomes feasible, growth will resume fast. "Can we assess quantitatively where the GDP in 2020-21 will end up? I think not. There is simply too much uncertainty regarding when we will be able to begin functioning normally without masks and social distancing. "It is all going to depend on when a vaccine against novel coronavirus and a cure for COVID-19 become available or when the virus would go into remission on its own," Panagariya, a professor of economics at Columbia University, emphasised. On how is reverse migration going to affect the economy, particularly, the rural sector, he noted that migrant workers will return to host states as fast as they left them once the government allows free movement of people and transportation becomes easily available. "The nature of migrant workers is to rush to home when their workplace is shut down and rush back to the workplace as soon as it opens up. "Just as the host states found it impossible to hold migrant workers back once their states went into lockdown, home states will find it hard to hold them back once host states unlock and resume work," Panagariya said. Lakhs of migrant workers in metro cities returned to their native villages after the nationwide lockdown was introduced on March 25 In the longer run, Panagariya stressed that the problem India needs to solve is the creation of a sufficiently large number of well-paid jobs for farmers who want to leave their tiny farms to seek a better living in industry and services. Asked whether he was satisfied by the pace of privatisation, Panagariya said, "Vested interests and socialist mindset have kept the process of privatization from moving forward even though the Prime Minister and his cabinet had blessed it as far back as 2016." He pointed out that COVID-19 has shown that the government needs to do a lot more in the area of health than it has been doing to-date. "But can it do so efficiently without withdrawing from other activities? Not in my view. "The natural activities from which to withdraw to focus better on health is manufacturing that serves no public purpose and is best carried out in the private sector," the eminent economist opined. Panagariya, who recently wrote a book 'India Unlimited: Reclaiming the Lost Glory', also appreciated the government for announcing numerous reforms that will help improve the efficiency of the economy in the medium to long run. "These reforms had been awaited for decades. I hope the announced reforms actually happen rather than shelved once the crisis is over," he said. When asked about criticism by some experts that India needed additional expenditure and not liquidity infusion, Panagariya defended the government's recently announced measures, arguing that fiscal stimulus, which works by creating demand, cannot go far when there are no workers to help generate a supply response. He suggested that while novel coronavirus is on a rampage, the government needs to ramp up health infrastructure to deal with the virus; ensure that the basic needs of people such as food and shelter are met; and provide enough liquidity so that solvent firms do not go bankrupt before the economy opens up. "Various packages that the government announced have focused precisely on these three items," he asserted. Last month, the government announced a Rs 20.97 lakh crore economic package, which included RBI's Rs 8.01 lakh crore worth of liquidity measures. Sitharaman had unveiled the package in five tranches, which included Rs 3.70 lakh crore support for MSMEs, Rs 75,000 crore for NBFCs and Rs 90,000 crore for power distribution companies, free foodgrains to migrant workers, increased allocation for MGNREGS, tax relief to certain sections and Rs 15,000 crore allocated to the healthcare sector. BKS CS MR MR

Biggest challenge to put financial sector back on feet once India unlocks economy: Panagariya

This August, 100 village boys and girls will set out on a mission to learn skills to help in building <keyword id="441511" type="UNKNOWN" weightage="80" keywordseo="rural-infrastructure">rural infrastructure</keyword> and boost farm productivity. 
 These youngsters will receive training for 90 days to become "<keyword id="2888739" type="UNKNOWN" weightage="80" keywordseo="barefoot-engineers">barefoot engineers</keyword>" as part of a revamped rural job guarantee scheme. Nearly 80% of the students picked are girls. Government officials told Economic Times that the term “barefoot engineers” was originally coined during the fag end of the previous UPA government's regime last year. 
 The present government led by Prime Minister <keyword id="6354477" type="PERSON" weightage="80" keywordseo="Narendra-Modi">Narendra Modi</keyword> has set a target of training 3,000 barefoot engineers by the end of this financial year. To train them, a group of qualified senior engineers have been identified. 
 
To be a barefoot engineer, a class 10 pass or fail certificate is all that is required. The first batch would be trained at two centres including Rajasthan and Madhya Pradesh. 
 
"The youth who would get trained could be employed back in the MGNREGS (Mahatma Gandhi National Rural Employment Guarantee Scheme) and use the skills to add to infrastructure in rural areas," a senior government official told Economic Times. 
 
Students would be taught basic mensuration, geometry and trigonometry to create basic infrastructure, which could be used for agriculture and irrigation purposes. 
They will also receive a certificate by the National Skill Council at the end of the 90-day course. 
 
ET reported the programme is part of the NDA government's drive to revamp the rural job guarantee scheme to link it to asset creation and capacity building. As part of this, the rural development ministry is also running a Livelihood of Full Employment (Life) project to build entrepreneurship and infrastructure in the rural areas. 
 
People who have worked for at least 100 days in MGNREGS and have basic education could make use of this project to upgrade their skills. 
 
(Image: Indiatimes)

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