Modi Govt's Economic Response to Covid is Timid, Ill-thought Out and Incoherent—Rathin Roy
In a 45-minute interview to Karan Thapar for The Wire, where he discusses both the economic crisis facing India and the political lack of capacity to handle the crisis affecting the wider Indian system, Dr Rathin Roy said of the government’s economic handling that it has responded: “to this terrible state of affairs with the pusillanimity that marks effete societies”. As a result, he added, the time for short term recovery measures to assist the economy has passed. They would have helped 18 months ago if they had been taken. The government did not act and the moment has passed. Now what India needs to climb out of the economic hole it has fallen into is major structural reform.
Need to sell goods and services to its own people for which they poorer people need more money in their pocket and mare employment. And also change the output composition of good and services which the vast market needs.
Strucutral changes ( not just reforms) : Since exporting is not on the horizon rightnow.. the govt could use land to boost poor housing. Signal would go out to cement and steel industry, to ramp up production, hiring etc. Go for low handing fruit in the north and north east where labour is cheaper, for sectors like textiled where there used to be earlier.. . Move capital to the north and the west
Health and education needs to be booted..
Building back differently https://www.business-standard.com/article/opinion/building-back-differently-121040801746_1.html Putting India back on the growth track demands a robust analytical framework to address the structural downturn in the economy caused by Covid-19
https://swadeshionline.in/news/building-back-differently May 15, 2021
The Covid crisis has temporarily created a situation where r>g (rate of return on capital (r)rate of growth of income (g)). As a consequence, the profit-led recovery has further exacerbated inequality. But just going back to business as usual will not solve for this. We will be back in a situation where r<g but with higher levels of inequality. The prospect of economic stagnation looms larger, and closer, unless we change tack to build back differently.
It is, therefore, essential that in building back from the Covid shock, the r<g dividend is under to alter the output composition of demand, recognizing that the pattern of growth, and the resultant output composition of demand, has been inherently unequalizing.
https://www.business-standard.com/article/economy-policy/we-have-to-treat-the-economy-as-if-this-is-wartime-says-rathin-roy-120032101254_1.html Rathin Roy to Arup Roy Choudhury 22 March 2020
A wartime economy involves investing in winning a war because if you do not win the war, there is no economy to invest in. And therefore, you have to repurpose the economy to make the materials needed for the job and not the materials that we would during peacetime.
In the specific case of a pandemic, therefore, we need to ramp up the health infrastructure of the country. We are therefore not looking at building new hospitals as we would in peacetime. We are looking at the things we can do to convert existing buildings — like a hotel or an industrial plant — into hospitals. Hospitals or public health care centres then take priority over everything else.