People in both countries need solid economic relief due to the meltdown of the economies caused by the pandemic. On Feb 1, India’s Finance Minister Nirmala Sitharaman will unveil the much-awaited Union Budget. Similarly, US President Joe Biden has put forward a $1.9 trillion COVID relief proposal for the US Congress to consider and pass the bill. Keeping politics aside, both countries should ensure the common man is taken care of during this unprecedented crisis. Now, is not the time to debate ideologies, strategies, deficits, policies etc. These are not normal times and require extraordinary responses (business as usual will not work)
The Finance Minister does have a huge challenge to provide a strong stimulus to the ailing economy, but at the same time make sure long term growth strategies and plans remain intact in some shape or form. Having said that, India’s common man need economic relief “NOW”. So, to me, the Finance Minister must deliver economic relief for the common man and not worry too much about long term reforms or fiscal prudence etc. Yes, the reforms and fiscal prudence may take longer, but the economy needs the stimulus “NOW” and this approach will ensure the common man and the struggling businesses can survive. What good will long term reforms or fiscal prudence be, if the businesses and the people cannot survive the present. It is like giving healthy lifestyle advice to a patient who is critically ill and dying – The patient needs immediate medical care “NOW” to save his life. The patient must be saved “NOW” and then there is time later on for advice related to living a healthy lifestyle etc.
A solid stimulus to the economy is absolutely needed - whether it is lowering personal or corporate taxes, simplifying the recently unveiled GST tax (national sales tax), increased spending on infrastructure, improve quality and affordability of public education, increase public health and social infrastructure funding, ease regulations across the board especially in the real estate industry. I am not saying “fiscal prudence” or “long term reforms” should be ignored totally, but now is not the time to limit economic relief for that reason. For the “long term” to work, “short term” needs to work first. These are unprecedented times requiring unprecedented response to revive the economy.
My advice to the finance minister “When in doubt, just do it”
Similarly, the US Congress should act now and pass the relief bill. This is no time to talk fiscal deficits or long-term plans or ideologies etc. People need relief “NOW”. Whether extending unemployment benefits, providing additional stimulus checks directly to people, increased funding to schools, states and small businesses, increased healthcare spending etc. Like in the case of India, I am not saying “fiscal prudence” or “long term plans” be totally ignored, but NOW is not the time to limit economic relief for that reason. As I said before, for the “long term” to work, “short term” needs to work first. Again, these are unprecedented times facing the US economy and the nation which require an unprecedented response.
Like my advice to the Indian Finance Minister, I have similar advice to the US Congress “When in doubt, just do it”
I am positive the world’s oldest democracy (my adopted country), and the largest democracy (my country of birth) will enact economic relief packages to not just survive this crisis but thrive in it.
Let us focus on putting “Nation First” – Politics can wait.
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