With the health crisis likely to turn into a financial crisis, Finance Minister Nirmala Sitharaman said the government was closely monitoring the situation and holding discussions with leaders of all the industries to come up with ways to help them.
The various government departments are holding talks with the specific industries to understand their demands. They will soon draw a plan in consultation with the PMO so that those interventions either in form of policy change or stimulus can be announced in the coming days.
Sitharaman said along with the Reserve Bank of India, the government was closely monitoring the way markets were responding to the coronavirus threat.
“As global markets have severe volatility, we also are consciously monitoring all of that. It is no consolation to say that stock markets elsewhere have suffered. But globally there are serious repercussions felt. Together with RBI we are closely monitoring.
We have already held meeting with all the industries who are facing a challenge. For them each department is studying how to give relief to challenges they are facing. We are monitoring it on a daily basis,” Sitharaman said during the cabinet press briefing.
Reacting to demands of fiscal stimulus to induce liquidity in the market, finance minister said interaction with the sectors through the departments concerned were happening. “We are trying to attend to requirement of the industries and also see where departments have to make interventions. Yes, we are moving on that front,” she said.
Sitharaman said even the RBI governor had said that they were aware of the developments globally. “He is open to the need of the hour. I am sure RBI will take a call,” she said referring to the central bank taking initiatives to control the slide in the market owing to bearish sentiments.
In a related development, the Union cabinet also approved the restructuring plan of the Yes Bank where the SBI will invest. Other private bankers, too, are pitching in to rescue the bank so that the financial contagion does not spread, thus further pushing the markets down the slide.
