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View: If a stimulus is to fight FY21’s deep recession, India is already very late

View: If a stimulus is to fight FY21’s deep recession, India is already very late
View: If a stimulus is to fight FY21’s deep recession, India is already very late
So, the truth about the timing of India’s fiscal stimulus is this — we are running out of time.

Synopsis

Covid-19 is an economic shock with huge negative effects. If the shock is allowed to play out without an effective external intervention, it is more than likely there will be damage — lost jobs, gutted businesses, low middle-income families descending to poverty, consumer spending caution — that will persist long after, say, immunisation begins.

When talking about fiscal stimulus, economists love to talk about 3 Ts — timely, targeted and temporary. What they mean is that a stimulus should be timed to get maximum bang for buck, should target people who will spend quickly and activities that will get off the ground quickly, and should be withdrawn when the economy recovers.We should have engaged with these 3 Ts from April, as the economy’s southward trajectory became clear.But for reasons
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