FINANCE MINISTRY BEGINS DELIVERING

An indication of welcome transformation within the Finance Ministry during Modi 2.0 has been the two sets of relief measures thus far announced during the same week by Finance Minister Nirmala Sitharaman. Had her first set of measures—which pushed back the deadline for compliance on a host of financial, tax and procedural matters from 31 March to 30 June—not been announced when she did, by April there would have been a flood of compliance disasters and defaults, many of which would have led to failures of financial entities and to catastrophic levels of additional NPAS. The second set of measures announced by the Finance Minister have to an extent taken care of some of the emergency needs during the Covid-19 pandemic of sections of the poor. In common with his childhood hero Mahatma Gandhi, Prime Minister Modi clearly cogitates at length about how to improve the lives of the poor in India. Imagine how much worse the effects of the Civid-19 epidemic would have been if the progress made in programs such as Swachh Bharat had not been initiated. These successes have come despite the “ancien regime” elements that still remain within the bureaucracy and in the political system who do not share PM Modi’s objectives, and many of whom seek to sabotage efforts at fulfilment of people-oriented missions. More steps are needed to be taken by the Finance Minister, such as a reduction in taxes and adding to the RBI’S threemonth moratorium on interest and other payments with other mechanisms designed to ensure that jobs are protected and not lost. PM Modi’s longstanding well-wishers (i.e., those who supported him many years before it was clear by 2013 that the Gujarat CM would be the next PM) expect that such additional steps will soon get taken. Not just small industry but large and medium industries need their employees protected through taking care of salary costs as well as working capital needs. It needs to be ensured that moneys doled out to companies through the RBI and the Finance Ministry go to the workers and for genuine working capital needs and not to further enrich shareholders and top management, for example by facilitating share buybacks. The 2008-09