The RBI has reduced the policy interest rates sharply and also pumped in more liquidity to the market.
It has also introduced loan moratorium and other measures such as increasing Ways and Means Advances (WMA) to the state governments, Credit Guarantee Schemes, among many other sectoral interventions.
The central government outlined Rs. 20 lakh crore stimulus packages with accompanied large scale structural reforms as part of Atmanirbhar Bharat Package.
Under the package the aim is to make India a manufacturing hub for the world. The package talks of 4 Ls: Land, Labour, Liquidity, Laws, with structural reforms in all these areas.
The PM also suggested five pillars of this package and they are: Economy, Infrastructure, System, Vibrant Demography and Demand.
The Atmanirbhar Bharat Package includes wider-ranging interventions such as DBT, food security, rural jobs under MGNREGS, Credit Guarantee schemes for MSMEs and Kisan Credit Card (KCC) scheme.
In a way, while this measure does not put additional fiscal cost in the short term, this can help in reviving investments in the sectors that are hard hit not only due to pandemic and the subsequent lock-down, but also due to successive shocks such as demonetization and GST implementation.
Further, this would also help banks that are struggling with NPAs and provisioning can be done to business in these crucial sectors.