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Tuesday, December 24, 2024 | 11:17 AM ISTEN Hindi

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What would be the best stimulus?

The lockdown and its gradual lifting have shown that (a) people are happy with consuming less, and (b) GST revenue is back on track even without a consumption/demand stimulus

economy, growth, trade, India, flag
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T C A Srinivasa-Raghavan
Here are a few things to keep in mind while the government ponders its stimulus options. 

The foremost is that India has found itself in this situation thrice before. 

The first was between 1966-69 after two successive wars and two droughts. The second was between 1979-1981 after a massive drought and the huge second oil shock. The third was between 1990-92 after the First Gulf War and a runaway fiscal deficit. 

At the end of the 1960s needing money, the government nationalised 14 banks.  At the end of the 1970s, it steeply raised indirect taxes. It also cut back on
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

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