‘Coronavirus Lockdown has Already Done More Damage to Economy than Demonetisation’ I Karan Thapar

In an interview that paints a stark and dramatic picture of the damage the Coronavirus health scare will do to the economy, and is the first wake up call in this regard, Prof Jayati Ghosh of JNU says already after 2 days of lockdown more damage has been done to the economy than by demonetisation since it happened in Nov 2016. She says growth in March is already negative and the economy will shrink over the next three months.
In a comprehensive interview to Karan Thapar for The Wire, recorded a few hours before Prime Minister Narendra Modi is due to address the nation for the second time since the onset of the Covid-19 pandemic, Prof. Ghosh says growth for the last quarter of the year ending March 31, 2020, is likely to be negative. For the year as a whole, it will be at least 2% below the Q3 figure of 4.7%, which puts full-year growth at 2.5%. She says it is impossible to say what growth will be for the year ending March 2021, because that entirely depends on what steps the government takes to deal with the effects of the lockdown and how effective they are.

The founding premise of The Wire is this: if good journalism is to survive and thrive, it can only do so by being both editorially and financially independent. This means relying principally on contributions from readers and concerned citizens who have no interest other than to sustain a space for quality journalism. As a publication, The Wire will be firmly committed to the public interest and democratic values.
We publish in four different languages!
You can also follow The Wire’s social media platforms and engage with us.
Facebook
Twitter
Instagram
Don’t forget to hit the subscribe button to never miss a video from The Wire!

[swadhwa]

Hats off to Madam Jayati Ghosh, the leading Economist, for the clarity of thought process, sharp analysis of the problems being faced (and likely to be faced in the time to come), courage of conviction, and the solutions suggested by her due to great concern for the Nation. I liked her analogy to the War Room! I belong to the Healthcare Sector and have some knowledge of its strengths (few) and weaknesses (several). I am very much concerned and deeply worried about the disastrous consequences of the Coronavirus Pandemic on India. I hope the Government listens to her. I am an optimist. I know this Government can do many good things. Thank you very much dear Mr Karan Thapar, for a brilliant interview. Your questions were very important as well as precise. You could get very honest and best possible answers from Jayati Ghosh Madam. I also greatly appreciate your message towards the end about avoiding hand shake and doing Namaste instead as well as your promise to correct your habit of touching face! My admiration for both of you has increased a lot after watching this Interview. A BIG THANK YOU!

[padmnabh]

This interview is no less scary than The Conjuring!!

[sanghamitraghosh]

@TheWire: i wish Mr.Thapar would stop interrupting the professor. After all it's her opinion we want to hear, not his. Also do inform him that constant paraphrasing was not required, as she is very lucid. Thank you.

[cleokarma]

Testing must be free. We need more ventilators and test kits to ease out the situation. And there has to be more education provided to the public to understand their responsibilities towards the situation.

[HimanshuS-YT]

We had to choose from between the two evils -
1. No lockdown - less economic damage but substantial life damage. Ex- USA's piece meal approach to lockdown
2. Lockdown - economic damage but lives saved.

These are desperate times.

[tusharsharma]

Synopsis:
1. IMPACTS/ IMPLICATIONS

- Urban Industrial & Services Sector : Lockdown would effect a huge slump
- Rural Economy : Produce going waste already( eg. Pea crops destroyed) accounting to Mandis being shutdown, pandemic to further hamper the already low demand stricken market as well as the supply chain.
- MSME sector: Demand shortage prevalant already, lockdown to further disrupt supply chain, huge spike in unemployment.
- Other sectors: Travel & Tourism, Aviation, Construction facing huge slowdown, to have implications on ancilliary industries.
-Retail sector: Disruptions most likely in supply chain, shortages speculated in the time to come.
- MFG./ Industries: Lockdown to plateau the growth
- Crude Oil : Govt to benefit from the plumetting prices as the benefits not relayed in the retail prices to the end consumers, demand falling on the other hand.
- GDP: Speculated to be negative for this quarter, probable to continue for the next quarter as well.

2. MEASURES/MITIGATION

- Focus on MSMEs by way of providing credit moratorium, support packages so as to retain employees, direct income transfers for the self employed.
- Salaried Employees: Initiate EMI deferrals
- Banks/ Financial Institutions- Govt. To recaptalise to keep the market afloat.
- Agriculture : Ensuring minimum support price(MSP) for the produce, moratorium on crop loans to farmers
- Unemployment : Food ration augmentation to the extent of making it free to the vulnerables.
- Health Sector - Augmenting wages of those employed in the medical services, equipping them with the requisites like the testing kits, masks, ventillators, etc, testing to be made free, availability of hygiene facility to the rural dwelling population.
- Take on state govts.: Liquidity crunch leading to inaction on account of recieving inadequate support from the centre.

[drvarshapatil]

This is the type of people and thinking our country needs .. What a wonderful lady .. Hats off 👍

[mazumdar]

our part-time maid was saying that her neighbours (rural area in Assam) are having lots of tomatoes unsold and don't know what to do. the professor is correct

[Rohit-ozor]

Now is the turn of the big corporates who have got tax breaks and who have produced NPAs to do something for the country.

[NeerajSikarwar]

karan thapar is simply brilliant.... we need more journalists like mr. thapar.

[brillianthoram]

As Chidambaram always says" Talent is needed to run the government ". Not orthodoxy, bigotry and illiterate communal mindset 😏. Pride and arrogance is dangerous and will bring to it's own downfall sooner or later.

[PritamSingh-ftmc]

If this lockdown continues for a little longer the government cannot expect substantial gains even at such a low oil prices as the consumption of oil products has fallen to a great extent.

[venydsouza]

Solutions given by her for those asking:
⏺️Increase wages of most vulnerables, salary of doctors, nurses etc.
⏺️Provide more gloves, masks sanitizers to hospitals.
⏺️Release the grains kept to the States, and give it free to people in need for over a year,
⏺️Give permission to more Manufacturers to produce testing kits, ventilators, gloves with enough urgency,
⏺️ Make testing free

⏺️Slums don't have enough water provide them with water and soaps.
⏺️Provide moratorium to MSMEs.
⏺️Extend time to pay EMI.
PS: The economy is jumping off the Cliff.

[kwokmanlam]

She is the one Indian Professor/economist that I

[esotericpilgrim]

This LEADY ( Madam ) is GEM 💎 OF A ECONOMIST, WHERE IS OUR FM NIrmala ( arrogantly speaks )

[sohailshaikh]

Everytime we cry for shortage of Infrastructure.. I don't know where the hell our common sense goes when Government spends Billions of Public Money on Non living things like Statues etc..

[rahulbose]

Thank you so much Karan Thapar and Jayati Ghosh and of course Wire. I've been living in a village for a long time and find the stark similarities in the realities of what Ms Ghosh is saying and advocating, in terms of the rural sector's wellness and the rural economy. Hoping the agencies that make the decisions take a note of this. Rahul Bose

[OnkarSingh-lqck]

Does the Modi govt have a Economist who has a thorough knowledge of the Indian Economy. We have a "chamcha" RBI governor, a FM ( who didn't present a budget which could stir the economy ), a Niti Ayog like the FM don't know what to do,

[siddharthsharma]

Economic hardship is a reality, but in times of humanitarian crisis we'll have to manage that

[sunilsaxena]

Very impressive prof, someone like her should be the think tank in govt, so much clarity in thoughts and actions required in all sectors of economy. Great economist