Less economic uncertainty than first COVID-19 wave: CEA

India may be caught up in the net of the second COVID-19 wave, but there’s less uncertainty now compared to the first wave because of the ongoing vaccination drive and the technology-aided ability to provide instant relief to the poor, says Chief Economic Advisor (CEA) Krishnamurthy Subramanian.

“I think, overall, compared to the previous episode, we are in a better shape because the vaccine is already out and the vaccination drive is proceeding,” he said at the Amazon Smbhav 2021 Summit. “So, I think the uncertainty is much lower.”

Referring to the first wave, Subramanian said the government’s policy was driven by the goal of saving lives during the difficult time; highlighting the Rs 1.70 lakh crore relief package announced on March 26, 2020 that involved free rations and cash-in-hand to the poor and vulnerable. He said technology helped the government provide quick relief to the poor.

“One key thing that has stood out during this entire pandemic is the role of e-commerce and digitization, something that India has really embraced. I think, the most salient example of this is, if you take the way which essentials were provided to 800 million people in India. We did that through the public distribution system and through the use of Jan Dhan-Aadhaar-mobile,” he explained. “Let me just contrast this to what the most advanced economy in the world, the US did. They had to first physically print out cheques, mail it through the United States post office, a process that took 45 days to two months, which India did at the click of a button.”

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However, experts believe the second COVID-19 wave in India is bound to have adverse consequences on the economy, with major economic hubs – Maharashtra witnessing partial lockdowns.