Prime Minister Narendra Modi held an interaction with industry stalwarts via video conferencing on March 23. The discussion was centered on the economic condition of the country as we come to grips with the Covid-19 outbreak and the relief measures that could be taken to mitigate its impact.
So far there has been no announcement from the government on fiscal measures. Even the expectations from the Reserve Bank of India on whether it is a repo rate cut, CRR cut, forbearance or any other regulatory changes are still awaited by industry.
On the other hand, fresh package of measures have been announced by the Federal Reserve and that has resulted in the US market Futures moving up and recovering. So global markets and global regulators have been announcing stimulus measures both fiscal and monetary and more measures are being announced by the Federal Reserve. Now the expectation is that India will also soon announce economic measures.
India Inc. is seeking a minimum of 50 basis point cut as far as repo rate is concerned but then the question is whether a repo rate cut itself would do anything to help industry at this point in time. To discuss what transpired at the meet, CNBC-TV18's Shereen Bhan spoke to Vikram Kirloskar President of CII.
Kirloskar said, "Everyone appreciated the Prime Ministers leadership especially on Janta Curfew. There was an unanimous concern for the low level jobs, the daily wage earners, how to protect them. There were suggestions from various industry associations and also senior industrialists saying that if necessary we will take job cuts but we have to try to protect our temporary and skilled labour, daily labour, service providers and things like that."
Kirloskar further added, "There were also discussion on essential services, how to make sure essential services and the logistics for essential services is sorted out, the processes for logistics for essential services also gets sorted out especially with some of the state borders being shut, some of the city borders being shut and how to sort that out. So these were some of the points that were talked about."
Of course there were lot of suggestions on NPAs, on moratorium on loans, reduction of interest rates, various tax issues to help industry get back on its feet, he said adding that from CII's side we have made a code of conduct for our members to show that we stand with everyone. We have also suggested perhaps lockdown may be necessary right now so that it doesn't spread further and we can get out of the situation as fast as possible.
"We have submitted a lot of individual items for sectors - on helping the sectorout in terms of money and how to get back on our feet. However, I think in the next two weeks we will work closely with finance minister's office and the Prime Minister's office on various suggestions on how we get each sector back on its feet after we cross this. We feel that it is most important to get back on our feet first", Kirloskar added.