Video Editor: Vishal Kumar
Vinayak Chatterjee, the chairman of Feedback Infra group suggested a sledgehammer approach to combat the current economic crisis with an immediate Public Works Programme, in the form of a National Renewal Fund (NRF).
He said that situations like now arose once in a 100 years and called for out of the box thinking. Chatterjee recalled the famine of mid-18th Century in Lucknow, which made Nawab Asafuddaulah sanction the construction of Bara Imambara, so as to create jobs for thousands of his subjects.
He went on to discuss the details of the proposed NRF and his role as a member in a Committee under the Finance Ministry. He also talked about his new-found interest in gardening in conversation with The Quint’s Editorial Director Sanjay Pugalia.
Here are a few excerpts from the interview. Watch the video above for the whole conversation.
“40-50 percent of infrastructural projects have reopened May and June onwards. Although there still prevail issues of shortage of labour, working capital issues and acquiring permission from local administration and health safety procedures for workers.”Vinayak Chatterjee, Chairman, Feedback Infra Pvt Ltd
A term ‘Misery Alleviation’ is being used by you in context of big infrastructural projects. This means that the living conditions of citizen are very poor. What is your take on that?
The aim of infrastructure before COVID-19 was to make India progressive, competitively capable, make infrastructural facilities available for all, and hence uplift the quality of life and ease of doing business.
However, after the pandemic, the issue of unemployment is so huge that the context and aim of infrastructure has completely changed. We need infrastructure to excel just to create employment, that is, Public Works Programme. We need huge number of projects to create jobs for lakhs and lakhs of people.
“Village-level Public Works Programme projects have already been initiated by the government by the name of Garib Kalyan Rojgar Abhiyaan and allocated Rs 50,000 crore. Massive scale Public Works Programme for projects like national highway, electricity transmission, coastal economic zones, etc, need to be initiated.”Vinayak Chatterjee, Chairman, Feedback Infra Pvt. Ltd.
How is the committee under the Finance Ministry reacting to your new ideas on fiscal action?
Our economy has received a historically terrible blow due to the pandemic. The economy which was growing at 6 percent will now grow at -10 percent in the year, so there is a reverse swing of 16 percent, wherein we were already struggling for employment, job creation and investment. This makes it a war-like situation.
Therefore, traditional thinking won’t bring results here. I have observed that government economists think within the boundaries of the Consolidated Budget of India. So, I am suggesting a bold move, outside the routine activity of the Union Budget.
We need National Renewal Fund for a 50-year period, which should comprise of the 14 percent of the GDP, ie, Rs 30 lakh crore. Out of this, 60 percent should be domestically funded, the RBI should print money and subscribe to that. The remaining 40 percent can be taken from friendly overseas developmental institutions.
Suggested Allocation of Rs 30 Lakh Crore
- TISCOM Revamp: Rs 2 lakh crore
- Infrastructure: Rs 10 lakh crore
- Misery Alleviation: Rs 3 lakh crore
- Health care infrastructure: Rs 1 lakh crore
- State support programme: Rs 6 lakh crore
- Financial sector recapitalisation: Rs 5 lakh crore
- Specific support to the MSME sector: Rs 3 lakh crore
“We can’t depend on FDI for infrastructure, because foreign investors are hesitant to invest in on-going projects due to the economic uncertainty because of the pandemic. But can rely on friendly funds to capitalise the 50-year National Renewal Fund.”Vinayak Chatterjee, Chairman, Feedback Infra Pvt Ltd
Chatterjee also talked about how India’s demographic dividend could become a huge liability while it is supposed to be an asset because of the black hole of unemployment.
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