The finance ministry is mulling an incentive or stimulus package for some sectors that it feels have been dented by the Covid-induced limited lockdown, or “mini containment” as the Centre has called it, sources say. Industries like travel and tourism that may take time to open up are likely to get some relief. In the
The finance ministry is mulling an incentive or stimulus package for some sectors that it feels have been dented by the Covid-induced limited lockdown, or “mini containment” as the Centre has called it, sources say. Industries like travel and tourism that may take time to open up are likely to get some relief.
In the previous lockdown, too, when the government had announced stimulus packages, it had kept in mind the special needs of these sectors that require more time than others to get clients as people are apprehensive of eating out or travelling, analysts say. But as Covid fear subsided after the first lockdown, tourism, especially within the country, had begun to pick up with foreigners, too, starting to trickle in though the numbers were still not encouraging. However, as the second wave of the pandemic walloped the country and its health infrastructure came in for flak, many nations banned travel to and from India. When this sector begins to open up again, it may still be quite some before foreign tourists return.
In a series of petitions to the finance ministry, representatives of this sector have requested the government for assistance. While the modalities and extent of the stimulus are yet to be decided, sources say the government may look at helping the sector to ensure people don’t lose jobs and it can provide assistance till the industry gets back on its feet.
“All over the world, governments have recognised that the travel and hospitality industries need help,” said food and travel sector expert Vir Sanghvi. “Some governments are helping by paying a part of staff salaries. Others have arranged tax holidays. Only in India does the government take the line that these industries deserve no help at all. This is a crazy attitude because these industries employ millions of people and because India has spent decades creating a travel and hospitality infrastructure. To let that infrastructure rot and to let millions starve is unconscionable.”
Apart from this, sources say the government is also looking at giving incentives to some small and medium industries as well.
The development comes at a time when British brokerage Barclays on Tuesday cut India’s 2021-22 GDP growth estimate by a sharp 0.80 per cent to 9.2 per cent, saying the economic impact of the second wave of infections has been deeper than initially expected.
The Reserve Bank of India and the finance ministry though feel, sources say, that the impact of this lockdown has not been as harsh as that of the previous one, even as more needs to be done to support struggling industries.
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