Business Desk, ETV Bharat: Amid the devastating impact of Covid-19-induced restrictions on the Indian economy, Confederation of Indian Industry (CII) President Uday Kotak has strongly advised the government to explore the option of printing money.
In an interview to NDTV, he further said the Reserve Bank of India (RBI) should support the government in this endeavour.
"In my view, this is the time to expand the balance sheet of the government, duly supported by the RBI (Reserve Bank of India)... for monetary expansion or printing of money. Time has come for us to be doing some of that... If not now, when?" the veteran banker told NDTV.
In an another interview to news agency PTI, he pitched for fiscal package to deal with the impact of Covid-19 pandemic.
The government could consider increasing the quantum of the credit guarantee scheme for providing collateral-free loans to small businesses from Rs 3 lakh crore to Rs 5 lakh crore, he told PTI.
Kotak said the COVID 2.0 has turned out to be “very very damaging” and has shaken the country, particularly in April and May.
Read More: 'Finally, sense has prevailed': Uday Kotak on SC's loan moratorium ruling
As against the initial expectations of 11 per cent growth in the current fiscal on a lower base of the previous fiscal, Kotak said, "It would be fair to say that it is likely to be probably less… it is likely to be less than 10 per cent. We have to watch the situation".
Amid this background, he said, "I would strongly recommend to the government to consider a fiscal package to support the lower end of the society and small and medium businesses. That can be through direct transfers, including through food and other measures on the one hand, and second schemes to support SMEs could be in the form of an additional package under the ECLGS scheme, which they did last year".
In 2020, the Union government announced the “Atmanirbhar Bharat” package to perk up the economy and the overall stimulus was estimated to be worth around Rs 27.1 lakh crore, which was more than 13 per cent of the national GDP.
To mitigate the impact of the pandemic, the government and Reserve Bank had come out with a series of packages in a phased manner totalling around Rs 30 lakh crore, which is 15 per cent of the GDP.
(With PTI Inputs)
