States need 6.4 lakh crore to bring on track the industries affected by Coronavirus
In the fight against the Corona epidemic, the lack of funds can make it very difficult for the states. The economy of all states has suffered a major loss due to the 21-day lockdown across the country. To handle this, if three per cent of the Indian GDP has is spent, then Rs 6.4 lakh crore will be required.
Relief package not enough
Experts say that after the lockdown, the states should not only increase the budget allocation to improve the health sector, but also need to allocate huge funds to bring back the areas which have been affected the most. According to the analysis done by Mint, if states spend just 15% of the budget allocation then 6.4 lakh crores will be needed.
In view of the increasing expenditure of the states, the Central Government and the Reserve Bank of India has allowed the states from borrowing and taking advances. During the 2008 global financial crisis, states were given a 0.5 percent relaxation on their credit limit.
Reduction in salary of employees
States will get reduced GST collections and other taxes due to the coronavirus. The government has so far reduced or postponed the salary of their employees due to the Corona crisis. Other states will also be forced to do this if the crisis is deepened.
1.7 lakh crore relief package
The Centre has announced a relief package of 1.7 lakh crore for the people most affected by the lockdown. Experts say that this is not enough to make up for the loss to the states. This is just 0.8 per cent of the total GDP which needs to be increased. Kerala has given a package of 20 thousand crores.
Earlier measures taken by govt
The government on March 14 has made a special way for utilisation of State Disaster Response Fund (SDRF) for taking preventive measures to combat Covid-19.
This fund was spent in setting up quarantine facilities, sample collection, protective gear for healthcare professionals, police and municipal authorities.
Total cases in India 4426; deaths 114
Coronavirus has created havoc in the world brining all economies to a halt. Originated in Wuhan, China , the destruction caused by the virus knows no bounds. United States stands with the highest reported cases of 3,67,758 followed by Spain (1,36,675) and Italy at 1,32,547 reported cases. The death tolls are also on a spree.
In India the total number of cases have crossed 4,000 and deaths have crossed 100. The total confirmed cases in India lies at 4426. The total deaths are 114. Active cases in India presently are 3,981 and 326 people have either recovered or discharged from the hospital.
