In an exclusive interview with The Quint's Editorial Director Sanjay Pugalia, MD and CEO of Centre for Monitoring Indian Economy (CMIE) Mahesh Vyas throws light on jobs and the state of the economy amid the coronavirus pandemic.
With lockdown relaxing, there is some relief in the job market. The unemployment rate that went up to 24% in April-May has come down to 17% in the first week of June.
State Of Jobs
According to Mahesh Vyas, state of jobs and unemployment rate has improved in June. Vyas said that it is a good thing that now more and more people are coming to the market to seek jobs. As per data, 43% Indians were looking for jobs in pre-COVID days. When the lockdown was imposed, this rate had come down to 35%, but now it has risen to 39%. This is a positive sign, said Vyas.
Vyas said that in the coming weeks, there will be special support from agriculture sector and MNREGA. Though it will take some time to go back to pre-COVID times but it is gradually improving.
State of Economy
Mahesh Vyas said that the loan that the government has arranged in the name of economic package does not seem to be very beneficial, because neither there is anyone seeking a loan now, nor are there any lender in the market. And the reason for this is that there is no demand in the market. The government has arranged a loan of Rs 3 lakh crores but currently, no one is planning to expand their business nor does anyone want to take loan.
Vyas said that after announcing so many economic packages, there is not even much hope that any more help will be offered by the government.
What is The Solution?
According to Mahesh Vyas, the only solution before the government to end the economic crisis is to give money in the hands of the people and increase government expenditure. But right now, every ministry is being asked to reduce spending. The reason for this is that since businesses almost stopped in April-May, the revenue of the government has also decreased. So overall the condition of the economy will be bad for this whole year and even then the government has no way to boost the economy. There is no immediate plan, so growth will be less than before.
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