India and the Coronavirus: Averting economic collapse and building economic resilience--What are the fiscal options?

In the third of its webinar series on the Coronavirus, NCAER hosted Arvind Subramanian, and Devesh Kapur to talk about their ideas on how to pay for the massive increases in public expenditure needed to shield the Indian economy and the millions of workers who have lost their jobs and incomes due to the Coronavirus pandemic. Subramanian is a former Chief Economic Adviser to the Government of India, Nonresident Senior Fellow at Petersen Institute for International Economics, and currently at the Harvard Kennedy School. Kapur is the Starr Foundation South Asia Studies Professor and Asia Programs Director at the School of Advanced International Studies, Johns Hopkins University. The discussion attended by over 160 participants was moderated by NCAER Director General Shekhar Shah.

As India enters the first day of the second Coronavirus lockdown, on present plans it will be an unheard of 40 days by the time this lockdown ends. India’s bold action on March 25 was necessary to avert a health disaster, but must be matched by even bolder economic measures by the Centre and States to protect the poor with little access to food and incomes and to buffer businesses facing financial collapse. Do the Union and State governments have the fiscal means to fight the Coronavirus on both the health and economic fronts? What are the bold but viable funding options we should be looking at? How can imaginative, rapidly put-together, bipartisan cooperative federalism between the Centre and the States help? Can government policies, funding, and programmes be a bridge between meeting pressing, urgent needs and reconstructing the Indian economy onto a more resilient, healthier, and faster development path?

In this very engaging NCAER webinar discussion, Kapur and Subramanian pursued answers to these pressing questions and then joined a Q&A session with the participants. Both Kapur and Subramanian are part of the Research Panel for NCAER’s India Policy Forum and frequent contributors to this apex annual policy conference held in the summer in New Delhi.