Second stimulus package likely as government monitors recovery: Report

The central government is looking at a second round of a stimulus package for the economy, and is monitoring various industries to enable support and recovery, reports Mint, quoting a senior government official.

The first package of Rs 20 lakh crore was used to deal with the massive impact caused by the nation-wide lockdown to curb the spread of the coronavirus. The Centre is aiming to smoothly execute the planned capital expenditure.

“We are keeping all options open and are watching the situation closely," an official told the publication on condition of anonymity.

For live updates on the coronavirus outbreak, click here

“(We will) keep supporting sections of the industry as and when there is a need," said the official, pointing to the evolving situation. “After all, the pandemic is not yet over. We do not have a vaccine yet," said the official.

The government is working towards optimum usage of the package, as the country's coronavirus cases has not peaked yet, and further monetary allocations may be required.

The borrowing for the current year is up by 53 per cent to Rs 12 trillion to deal with the humanitarian and economic crisis compounded by Covid-19.

Also Read: India's GDP contracts by 23.9% in Q1 of FY2021

India has recorded one of the sharpest Gross Domestic Product (GDP) contractions, shrinking by almost 24 per cent, but the Centre is hopeful of a ‘V’ shaped recovery.

The Finance Ministry released a circular stating the departments are not encouraged to come up with new projects, as well as measures taken to curb spending.

“It is not that we are rationalizing (expenditure) in that sense. Whatever is scheduled to be spent by the government and departments is going on," said the official.