Former Reserve Bank of India (RBI) Governor Raghuram Rajan on Thursday said that the coronavirus lockdown cannot go on forever and the government must plan an exit and manage it well. Another round of lockdown would have a devastating impact on the Indian economy, Raghuram Rajan said in an online interaction with Congress leader Rahul Gandhi. "A lot of work needs to be done both on creating the structures, as well as ensuring that the work place is relatively safe. As well as ensuring that if there are accidents, if there are fresh cases, how do we isolate quickly without having to go to a second or a third lockdown. Those will be devastating if we have to go there," Raghuram Rajan also said.
India needs to be 'cleverer' in reopening the economy since any resurgence in coronavirus cases could dent the credibility of the government, he said.
"There are ways countries can take advantage of the situation. There will be rethinking. In this situation India can find opportunities for its industry," Rajan said when asked if India is in a position to get strategic benefit post-coronavirus. Rajan, now a professor of finance at University of Chicago's Booth School of Business, also said, "India can play a role in shaping the dialogue. It is big enough to make sure its voice is heard. It can try and mould the dialogue towards one which has place for more countries in a multi polar world order."
On being asked about what's needed to help the poor population in India, the noted economist said,"India will need a budget of Rs 65,000 crore to help the poor. India should do this." Raghuram Rajan also raised concerns on the current coronavirus testing rate in India. He said that the rate of testing is nowhere close to the US, which now has the highest number of coronavirus cases. The rate of testing needs to be increased much more, he added.
Rajan also raised worries around the gig economy in the country. He said that the jobs in that sector are most vulnerable in times of a pandemic. The former RBI governor Raghuram Rajan and Rahul Gandhi were discussing the economic crisis looming over India due to the ongoing lockdown and measures to tackle the problem.