NEW DELHI: India’s Prime Minister Narendra Modi has unveiled a stimulus package worth 10 percent of the country’s GDP to boost laborers and small businesses as the economy reels from the coronavirus pandemic and a weeks-long lockdown. The 20-trillion-rupee (US$266 billion) relief plan for Asia’s third-largest economy came as the country enters its 50th day under the world’s biggest shutdown on Wednesday.

The economic package “will give a new momentum to India’s development journey and put India on the road to self-reliance,” Modi said in a special television address to the nation. “It is for the cottage, small and medium-scale industries.” The government has credited its strict shutdown of almost all activity in the country of 1.3 billion people for limiting the number of virus cases, which currently stands at just over 70,000 infections, including 2,293 deaths. But the livelihoods of tens of millions of people have been badly hit, particularly the poor and migrant workers, many of whom have lost their jobs.

“Day laborers, migrant workers have suffered much in this period. It is our duty now to do something for them,” the prime minister said. The funding announcement includes a smaller relief package announced at the start of the lockdown in late March and stimulus efforts by the central bank, Modi said. Finance Minister Nirmala Sitharaman would unveil further details in the next few days, he added. The Indian leader stressed the need for the country to be self-reliant, and for people to buy local products to help the economy.

“The corona crisis has also taught us the importance of local supply chains… we have to now think local,” he said. The president of Indian industry body FICCI, Sangita Reddy, welcomed the package and said it would “address the needs of the poor and needy, MSMEs (micro, small and medium enterprises) and also the industry and common man.” Analysts said the package was a “much-needed boost for the Indian economy”. “This is a good and bold step… as different sectors and small-scale businesses were desperate for relief,” State Bank of Baroda chief economist Sameer Narang said.

Economic woes
India was already battling a liquidity crisis, bad loans and rising unemployment even before the pandemic arrived in India. Some 122 million Indians lost their jobs last month, data from Mumbai-based think tank Centre for Monitoring Indian Economy showed, with small traders and daily wage earners accounting for the bulk of losses. The nation’s key services sector plummeted in April, indicating a severe slowdown in the economy. Efforts to re-start activity in several industries as the lockdown was gradually eased have meanwhile stumbled amid a shortage of labor. 

Many migrant workers have fled or are leaving India’s cities on foot or on special train services to their home villages after struggling to feed themselves and their families amid the lockdown. Modi said the next stage of the lockdown, which is due to be lifted on May 18 after being extended twice, “will be different in many ways”. “It will be based on suggestions received from states,” he said, adding that an announcement would also be made in coming days. “Corona will be part of lives for a long time. But we cannot allow that our lives will just revolve around the corona crisis.”

Trains start rolling
Meanwhile, India’s enormous railway network tentatively ground back to life Tuesday as a gradual lifting of the world’s biggest coronavirus lockdown gathered pace even as new cases surged. The country of 1.3 billion imposed a strict shutdown in late March, which Prime Minister Narendra Modi’s government has credited with keeping cases to a modest 70,000, with around 2,300 deaths. But the lockdown, which enters its 50th day on Wednesday, has torpedoed the economy, snatching the livelihoods of tens of millions of people and hitting the poor the hardest. 

Whole industries have been devastated from tea plantations to diamond-polishing and there are fears of food shortages, while a ban on flights has left hundreds of thousands of Indians stranded abroad. Restrictions have been steadily eased, however, particularly in rural areas, and some Indian trains - on a network which normally carries over 20 million passengers a day - resumed on Tuesday. More than 54,000 tickets for an initial 30 services sold out online within three hours on Monday, reports said. Two trains left New Delhi on Tuesday afternoon with 2,300 people on board. Others left different cities including Mumbai.

The government has not set out a program for a timetable beyond May 20. There were limited special train services laid on after the lockdown was imposed to ferry home some of the millions of poor migrant workers left jobless and destitute by the shutdown. Many people, however, were forced to walk hundreds of miles (kilometres) to get home. Some died on the way, including 14 workers crushed by a goods train in Maharashtra last week. Passengers in face masks or with handkerchiefs over their mouths queued outside New Delhi station on Tuesday, waiting to be screened for coronavirus symptoms.

Ajay Dewani, a photographer stranded in Ghaziabad with a ticket for Chattisgarh state said he walked for four hours to get to the station. “I haven’t been paid for two months and my landlord was hassling us for rent,” he told AFP, carrying a backpack and pulling a wheeled suitcase. But Usha, a laborer from Madhya Pradesh state, said she, her husband and their two children were turned away because they had no ticket. “We came here to the railway station as we were told that the trains will start working from May 12,” she told AFP. “Where do we go now? We have no money to buy something to eat.”

Cases rising
On Monday Modi held a video conference to discuss further relaxation of the lockdown when it ends on May 17 with state chief ministers. Some reportedly were critical of the measures being eased. In an address to the nation late Tuesday, Modi said further announcements about changes to the lockdown, which is due to lift on May 18, would be revealed in coming days.
He added that the lockdown, which has already been extended twice, “will be different in many ways” and have “new rules and regulations” as he announced a stimulus package worth US$266 billion to boost the struggling economy.  The number of cases is still rising in India, with more than 3,600 new infections recorded on Monday - just below Sunday’s record of more than 4,000. Major cities including Delhi, Ahmedabad and Mumbai - home to the Dharavi slum area - have been worst hit by the new surge, and health specialists say infections may only peak in June or July. —Agencies