Phase 2 of coronavirus lockdown in India began on April 15 as the number of COVID-19 positive cases continued to spike, despite the initial restrictions imposed for 15 days. Lockdown 2.0 would have an adverse impact on the economy as the manufacturing sector will remain shut. However, there are some hopes of factories being restarted in certain zones where extreme care is taken to ensure that no new cases are reported.

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Rajiv Kumar, Vice Chairman of NITI Aayog in an interview with CNBC-TV18, said that as the "spread rate" of the virus reduces, relaxation in the restrictions would follow.

“The response will depend entirely on how the pandemic plays out. There can be no assumptions here. We are hoping that until April 20 we would have broken the back of the pandemic and our infection rate would come down, if that happens, there will be some relaxation ,” he said.

However, he stressed that talking about business as usual could be premature. “Institutions for example educational institutes will not open. We may not get permission to have religious congregations or marriage ceremony and parties, etc. I think knowing about how this virus is going to play itself out, caution would still have to be exercised,” Kumar said.

Talking about the impact of the lockdown on the economy, he pointed out, “I think people are being brave to make forecast for the whole financial year -- FY21 at this point of time. It is just the beginning of the year, we know that this month is lost in terms of economic activity, but it has not been lost for agriculture. Our rabi crop harvest will come quite nicely and it could be one of the best crops and the best harvest. So, we have not been foolhardy enough to forecast anything at this point of time.”

“Once economic activity starts in the second quarter, I think you will see a fairly strong recovery in the country for the next three quarters of FY21. To support that I am sure the government will come up with a fiscal stimulus. There is a clear understanding within the government and Reserve Bank of India (RBI) that we have to do whatever it takes to get the economy back on track. We know that the implications of a very weak growth are going to be negative. I am convinced that with the fiscal policy package now in the making, we will see economic activity going back quite strongly from the second quarter onward,” he added.

Speaking about the delay in announcing a fiscal package, he said, “It is quite clear that our primary concern and our primary focus must still remain to save lives and to try and ensure that we do not have the pandemic spreading as it has in other countries. Therefore that has taken the primacy in terms of policy attention and in terms of policy announcements.”

“India is a complex country with a complex economy. Our diversity is significant to come up with a pan-India solution, it takes time to develop guidelines. Plus, we do not have the luxury of unlimited resources at our disposal. So we have to figure out what is the cloth that we have and which to cut our coat as it were. So, that is being considered quite actively. I know that some of us are being impatient, but the request from us would be to have a bit more patience because at this point of time it is important to get it right and it is important to therefore take as many variables on board as we can before something like that is announced,” he said.