Finance Secretary Ajay Bhushan Pandey on Sunday said that the government was working on another stimulus package amid speculation about a fresh round of stimulus measures ahead of Diwali. reported ANI. He, however, refused to divulge details or give a timeframe.
“We keep monitoring the situation on the ground to assess which sector of the economy or segment of the population needs what kind of help at which time and respond accordingly,” Pandey told ANI. “We keep taking suggestions from industry bodies, trade associations, various ministries and after going through their suggestions and requirements of the economy, we come out with timely measures.”
He added that the impact of the series of packages announced by Finance Minister Nirmala Sitharaman is now visible, reported Moneycontrol. “It has been a case of continuous monitoring and also continuous response, and that is why the finance minister came with a series of packages and stimulus periodically. We can see the results now, we can see their impact,” the finance secretary was quoted as saying.
He added that certain sectors may need further interventions. “We are having discussions with the stakeholders concerned – industry bodies, the ministries, small and medium enterprises and various other sectors,” said Pandey.
“The finance minister has already said that we will not left wanting if certain interventions are needed. We have to identify the sectors which need interventions. That is precisely why we are having discussions with stakeholders.”— Ajay Pandey
Pandey said every sector was being analysed. “Whatever was required for helping migrants, vulnerable sections of the rural or urban populations, we did,” he added. “When the nation was in lockdown, we gave cash to women Jan Dhan account holders in their bank accounts through DBT. We provided early instalments to farmers under PM Kisan Yojana.”
“We helped employees and employers in their EPF contribution. We earmarked Rs 3 lakh crore for enhanced working capital to MSMEs, out of which Rs 2 lakh crore has been sanctioned and amounts are being disbursed. MSMEs were also given the benefits of loan moratorium. We have given income tax refunds of Rs 1.27 lakh crores in last seven months. We have given GST refunds of Rs 70,000 crore.”— Finance Secretary Ajay Pandey
Pandey claimed that the economy was on a path to revival. “September and October data shows that we have reached pre-Covid-19 level and gone into positive territory,” he said. “If we compare with the last year, the E-Way bill in September has seen year on year growth of 10% and in October it has seen a growth of 21%.” Goods and Service Tax collections in October stood at Rs 1,05,155 crore, going over Rs 1 lakh crore for the first time since February.
“If we are able to maintain this growth for the next five months, then we can say that we can transition from deep negative zone to near-zero growth zone by March 2021,” said Pandey. “International Monetary Fund has projected India’s GDP to contract 10.3 per cent this fiscal year, revised from its forecast of a 4.5 per cent decline in June.”
The finance secretary, however, ruled out any cut in GST rates in the near future. He said that it was a wrong impression that rate cut boosts sales and growth. “One may see the example of mobile phones,” he said. “Mobile phones are attracting an 18% GST rate from April 1, 2020, up from the earlier rate of 12%, after the GST Council corrected the inverted duty structure. Now see the current sales figures for mobile phones. Despite the increased tax rate, their sales are up.”
“Frequent tinkering with the tax rates is not good for the economy. It also sends wrong signals to domestic industry and international investors. We have to provide stability and predictability in our tax systems,” he added.