Krishnamurthy Subramanian asks private firms to stop asking govt for aid

Private firms in the country need to fend for themselves instead of relying on government aid and measures in the quest to develop a self-reliant India, the country’s Chief Economic Advisor, Krishnamurthy Subramanian said.

He was speaking to the Bharat Chamber of Commerce and Industries on a virtual platform. Responding to suggestions from the industry body asking for various steps to boost domestic firms, Subramanian said, “Atmanirbhar Bharat or self-reliant India cannot just happen with domestic companies asking for government help and support. They also need to work it out on their own”.

Various departments of the government, including Department of Commerce, Department for Promotion of Industry and Internal Trade, civil aviation ministry and others like BSNL and some state electricity boards are either issuing policy directives or working on tweaking rules to push domestic manufacturing. Measures like additional permissions and licences for importing tyres have also been put into place.

Aiming at import substitution, Prime Minister Nardendra Modi rolled out the campaign to push domestic manufacturing and services which is aimed at boosting the cash position of companies at a time when nearly all major sectors except healthcare and food products are witnessing a fall in demand.

Subramanian said that since India had a public distribution system of food grains, the country didn't need to directly transfer cash to the people to support them in times of the pandemic. “In the Jan Dhan accounts, it has been seen that people are saving more owing to the current uncertainty. If we give money to the people, it will only enhance their savings”, he said.

The official termed the ongoing crisis as a “health crisis unlike the economic crisis of 2008” stating that while measures were being taken to boost demand, it was likely to remain muted until either a vaccine was found, or people develop “a faith to control this pandemic”.

“Unlike other sectors, healthcare is witnessing a surge in demand and it is getting reflected in the prices which they are charging”, the official said.

The Supreme Court, on Friday, asked the Centre to put a cap on the upper limit for Covid-19 testing as well as ordered for uniform rates across the country. The NITI Aayog has also recommended substantially lower rates for hospitalisation charges in Delhi NCR than the prevalent rates in private hospitals.