Open Access Research Article
Building Back Better: Deciphering India’s Post-Pandemic Fiscal Policies For Inclusive Recovery (By-Sulochana Anu)
Published Paper
Article Details
Building Back Better: Deciphering India’s
Post-Pandemic Fiscal
Policies For Inclusive Recovery
Authored By-Sulochana Anu
Institute of Company Secretaries of India
Abstract
India had been witnessing an economic slowdown even before the pandemic
and the covid-19 has largely inflated the existing risks. India’s growth
declined to 4.1% in the fourth quarter of FY2020. The renewed outbreak and
second phase of restriction on mobility heightened the uncertainties in income
and employment in several sectors.
The Government of India stipulated various initiatives to mitigate the
pandemic-induced stagnation from food security to fiscal stimulus on health
care and other sectors, introduced major tax incentives, etc.
Mitigation
Strategies
On 12 May 2020, Government announced the
Aatma Nirbhar Bharat Package (ANBP), under which a monetary infusion of 20 lakh
crores, which is equivalent to 10% of India’s GDP.
Several measures
implemented under the ANBP include:
Social
Security
·
Relief measures for households such
as food and LPG
·
Cash transfers to vulnerable
communities such as senior citizens, disabled, widows, and farmers. 20 Crore
women Jan Dhan account holders will be allocated Rs 500 per month
·
Insurance coverage for frontline
workers in the healthcare sector
·
Increase in wage in MGNREGA
·
Reduction in EPF contributions
·
Employment opportunities for migrant
workers
Tax Reforms
·
Tax filing and compliance deadlines
have been postponed
·
The penalty interest rate for overdue
GST filings is reduced
·
Rapid clearing of MSME dues.
Structural Reforms
·
Non-intervention in the Agriculture
sector
·
New PSU policy
·
Increased FDI limit in Defense and
Space sector
·
New power tariff policy
·
Revitalizing Viability Gap Funding
Scheme for Social Infrastructure Notably, all the states have been incentivized
to undertake sectoral reforms.
The Reserve Bank of India has been a major stakeholder to counter the
lock-down induced economic slowdown. It proposed an independent committee to
evaluate the experience with GST. The central bank suggested that only
efficient insolvency laws will galvanize the growth of the manufacturing sector
which is primarily locked in structural slack amidst the pandemic.
The scheme has been monitored and revised periodically throughout the
pandemic.
The outlook on prominent outcomes of the Aatma Nirbhar Bharat Package,
which inter-alia include:
1.
Under Pradhan Mantri Garib Kalyan
Yojana (PMGKP), Rs. 1.70 Lakh Crore was released for the poorest of the poor,
in helping them fight against the Coronavirus. Insurance cover of Rs 50 lakh
per health worker combatting covid-19 which is extended for one more year
effective from April 2021
2.
Free distribution of food grains
under Pradhan Mantri Garib Kalyan Ann Yojana (PMGKAY) ensures adequate
availability of protein to the vulnerable communities. 5 kg wheat or rice or 1
kg of pulses every month to 80 Crore below poverty line communities has been
extended to November 2021
Panorama
of Bills, Acts and Ordinances for an Inclusive Recovery
The
Insolvency Bankruptcy Code (Amendment) Ordinance 2021
The Insolvency and Bankruptcy Code was first promulgated in 2016.
India’s consolidated bankruptcy law ensures an efficient process of winding up
of companies without any undue delay bringing out an optimum recovery
rate.
The IBC was amended in 2021
through an ordinance, on 4 April 2021. The amended code envisages an
alternative resolution process in a time-bound of 330 days for corporate
debtors.
The pre-packaged Insolvency Resolution Process is introduced for micro,
small and medium enterprises (MSMEs). Under PIRP, the debtor should have a base
resolution plan and the administration of the company will remain with the
debtor. A committee of creditors will be constituted and the resolution plan of
the debtor must be approved by the committee by at least 66% of voting shares,
within 90 days from the commencement date of the PIRP.
The National Bank for Financing Infrastructure and Development (NaBFID)
Bill 2021
The Ministry of Finance, Corporate Affairs, and
Information Broadcasting introduced the NaBFID bill on 22 March 2021.
·
NaBFID is a financial institution
established for providing monetary benefits to the sectors where the risks
involved are beyond the resolving capacity of the commercial banks and other
financial institutions.
·
The funds for NaBFID are sourced from
the market, multi-lateral institutions, and government guarantees.
The Code On Social Security 2020
Labour falls under the
Concurrent List of the Constitution. There are around 100 state and 40 central
laws regulating various aspects of labour such as wages, employment security,
working environment, and resolution of industrial disputes. The pandemic
necessitated the amendments of laws pertaining to a safe, secure and inclusive
working environment, focusing on life more than a livelihood.
The Ministry of Labour and
Employment introduced The Code on Social Security 2020 which subsumes eight
existing central labour laws.
·
The 2020 bill reduces the maximum
working time to eight hours, intending to reduce the exposure of pathogens in
the environment.
·
Women are entitled to be employed in
all types of work negating the earlier bill that prohibits them from hazardous
employment opportunities. With adequate safety protocols, such employment
opportunities ensure social security to vulnerable, unorganized, and informal
workers whose livelihoods were the most stunted during the lockdown phases.
·
The code assures that gig and
platform workers will be funded by central and state governments.
·
The bill aims to reduce the gratuity
period to three years for working journalists from five years.
The Epidemic Diseases (Amendment) Bill, 2020
In September 2020, the Ministry of Health introduced the amendment of
the Epidemic Diseases Act, 1897.
·
The bill amends the act that assures
protection for healthcare personnel combatting epidemic diseases.
·
It expands the prevention of
outbreaks of epidemic diseases.
·
Persons convicting of attacking
healthcare workers will be liable to pay compensation to the frontline workers
whom they hurt.
The Road To Recovery
With the covid-19 pandemic, the Indian economic structure has been
changed drastically. The central government and the central bank have been
pivotal in trying to ease the lockdown-induced crisis by various actionable
stimulus measures.
The World Bank has projected that the Indian economy is expected to
expand 8.3 percent in the fiscal year 2021-22. A strong policy support on
health care, manufacturing, infrastructure, and rural development and access to
vaccines determine the durability and resilience of recovery of the South-east
Asian nation.
Article Information
Building Back Better: Deciphering India’s Post-Pandemic Fiscal Policies For Inclusive Recovery (By-Sulochana Anu)
Authors: Sulochana Anu
- Journal IJLRA
- ISSN 2582-6433
- Published 2022/08/05
- Volume 2
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
- Access Open Access
- License CC 4.0
All research articles published in International Journal for Legal Research and Analysis are open access and available to read, download and share, subject to proper citation of the original work.
Disclaimer: The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of International Journal for Legal Research and Analysis.