Context:- 30 years of the landmark economic reforms aka LPG reforms came in the time of economic crises. This time too in 2021 we are facing the economic crises but with the bigger magnitude.
Why crises acts as a forerunner of reforms
- It changes the behaviour of the people i.e. product people relationship.
- It create a vacuum which sets the stage for the reforms.
- Crises shakes the foundation of existing building i.e. it shows that current rules and regulations can’t be worked on.
But In this time government can’t take drastic measures why?
- Because the magnitude of crises is way larger than 1990 one.
- It can have repercussions.
- 1990’s crisis was due to the endogenous problems but this crises is due to the exogenous problems
- Even if large measures are taken, they are highly unlikely because indian economy depends on the global.
What we should do to revive the economy
- Rural economy based on MGNAREGA.
- Some relief measures one this pandemic weaken.
- People must think that we have to live with this virus.
- State government proactiveness in the economy.
- Government increased spending on infrastructure.
- Vaccination programme for whole population