Even as India's coronavirus tally has gone past 21,000 mark, Arvind Virmani, former chief economic adviser, on Thursday, said asking people to pay salaries during the lockdown is 'absurd' as in this period there is no income generation.

Share Market Live

NSE

Virmani, who is present chairman of the Foundation for Economic Growth and Welfare (EGROW), told CNBC-TV18 that people are not understanding the implications of lockdown and the government should think about measures that can work when the lockdown is over.

He said 40 percent population at the bottom should be kept in mind while taking measures.

Virman added that density is also a problem, as 30 percent of metro city population live in slums. Within 2 months of lockdown, he estimated there will be a loss of 9 percent of GDP.

Meanwhile, a Ludhiana-based MSME association has moved the Supreme Court (SC), challenging the home ministry’s order directing for payment of full salaries to all workers during the lockdown. It has called the order unconstitutional and has argued that such payments will lead to the closure of many MSME units and will cause permanent unemployment.

India's coronavirus tally has now risen above 21,000 and active cases stand at over 16,000. Recoveries have also crossed the 4,000 mark.

As the country prepares to deal with the economic consequences of the pandemic and the nationwide lockdown, Prime Minister Narendra Modi is expected to meet with finance ministry officials on Friday to discuss economic relief measures. Sources say the focus will be on boosting rural income, tackling the agrarian distress and helping MSMEs survive the current economic slowdown.

Ahead of that crucial meeting, RBI governor Shaktikanta Das, former RBI governor Urjit Patel, PMEAC chairman Bibek Debroy are believed to have met PMO officials on April 22. Sources say NITI Aayog vice-chairman Rajiv Kumar, policy think-tank's CEO Amitabh Kant, finance commission's chairman NK Singh as well as top finance ministry officials also attended this meeting to exchange views on coronavirus impact.

Also, to bolster its fight against COVID-19, the central government has frozen the dearness allowance (DA) for its employees and dearness relief (DR) to pensioners at current rates between January 2020 and July 2021. The government expects that this move will help it save Rs 37,500 crore over the current and the next financial years. State governments are also expected to save over Rs 82,500 crore.

First Published:Apr 23, 2020 6:05 PM IST