India should be cleverer in lifting the lockdown and needs to open up its economy in a "measured way" soon to save jobs, former RBI governor Raghuram Rajan said on Thursday, underlining that Rs 65,000 crore should be spent to support the poor amid the crisis.
In a first of its kind dialogue broadcast on Congress' social media handles this morning, Rajan, who was in the US, deliberated on the economic impact of the COVID-19 pandemic with Congress leader Rahul Gandhi.
The interaction through video conference lasted for about 30 minutes.
"We have to be cleverer about opening up...We need to open up in a measured way but as fast as possible so that people start having jobs. We don't have the capacity to support people across the spectrum for too long. Being a relatively poor country, people start out with significantly lower reserves," Rajan said.
"It is all too easy to have a lockdown forever, but obviously that is unsustainable for the economy," he said.
To Gandhi's query on how much money is required to help the poor in the current situation, by way of subsidies, food and cash, the former RBI chief said, India needs Rs 65,000 crore to help them in times of pandemic and considering its total GDP, it can afford to do that.
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"Our GDP is 200 lakh crores, and out of that 65,000 crore is not a huge amount. So, we can do it. If this is for the poor and to save their lives and livelihood, we must do it," the economist said.
India has been in lockdown since March 24 midnight to curb the spread of coronavirus and the same will be in force till May 3.
Rajan felt there will be a rethinking on everything in the global economy once the world is out of this pandemic and India could use this opportunity to make its voice heard in the global arena and help make the dialogue multi-polar from being single or bipolar currently.
He said India can also find opportunity for its industry and supply chain in the new order.
Gandhi said infrastructure connects people and that gives opportunity, but if there is division and hatred, that disconnects people.
There is an infrastructure of division and hatred and that causes a big problem, the Congress leader said.
Agreeing with Gandhi, Rajan said, "Social harmony is a public good. Having everyone believe that they are a part of this system, an equal part of the system, is essential. We cannot afford to be a house divided especially in these times when our challenges are so big."
During the session, Rajan also posed a few questions to Gandhi, asking him his views on Panchayati Raj to which the former Congress chief said, "It has had a huge effect, but I'm sorry to say it is in retreat."