Government’s decision to borrow additional 4.2 lakh crore and exceed the target from 7.8 lakhs to 12 lakhs crore in the view of coronavirus pandemic. Almost all the ministers mainly former finance minister welcomes this decision as it will sort all the possibilities and will be used to provide relief to the poor and restart the economy to tide over the Covid-19 crisis. Despite of the borrowing, government has taken the projected fiscal deficit to 5.38%. And that a revised expenditure budget for 2020-21 is awaited.
The estimated gross market borrow ing in the fiscal 2020-21 will be Rs 12 lakh crore, in place of Rs 7.8 lakh crore according to the budget estimation for 2020-21. The revision in borrowings was important due to the Covid-19 pandemic, the finance ministry said. The fiscal deficit of 3.5% should not be a limitation in these situations.
This step taken to curb the spread of this global pandemic is a major one. As it involves the deficit rate and borrow ings which will impact the economy in later years. As the growth rate forecasted for this year is nearly to zero per cent. Paying off the loans and reducing the deficit, re charging the economy altogether will be a tough task. With the population of 1.3 billion, creating jobs and opportunities for survival is not going to be easy. But together we will survive.