Rationale behind the package

Govt seems to be preserving some firepower

The Rs 20-trillion economic package, announced by the government last week to deal with the impact of Covid-19, has been termed inadequate by many commentators. The package relied mostly on liquidity measures announced by the Reserve Bank of India (RBI) and extending credit to various sectors of the economy. As a result, the fiscal outgo has been just about 1 per cent of gross domestic product (GDP). Explaining the rationale for limited fiscal intervention, Union Finance Minister Nirmala Sitharaman said in an interview with this newspaper that the government had learnt lessons from the actions after the 2008 crisis and