The farmer protests are unlikely to dent the economy or have any impact on the national gross domestic product (GDP), Sanyal said, responding to a question on the farmers’ protests during a press conference on Wednesday.
In an uncertain future, “you need the farm sector to be flexible and that requires markets to be able to work to be able to deal with changing climate, changing consumer behaviour, export things,” Sanyal said, at the Indian Women’s Press Corp.
When asked about the economic impact of the farmers’ protest and the burning of crops as part of the agitation, Sanyal said, “There may be some minor disruptions to traffic going in and out on certain routes but I don’t think from a national GDP perspective, it will have any impact.”
Migrant labour crisis
Responding to a question on the migrant labour crisis that resulted from the lockdown last year, Sanyal said, “No matter what strategy we took, there would be unintended consequences when you’re dealing with such a large number of people. So you have to take a broad strategy and adapt along the way.”
Travel and tourism sectors
The government is also considering support measures to the worst-affected sectors of the economy like travel and tourism, Sanyal said.
“There are certain sectors which continue to have difficulty and that is not surprising, which is related to travel and tourism and contact-intensive entertainment…we will clearly have to provide some support for that, but obviously we don’t want to open up international travel for obvious reasons,” he said.
GST compensation to states
With regards to the goods and services tax (GST) shortfall of the states in the current fiscal, the Centre has no moral obligation to compensate the states on account of the Covid-19 shock, Sanyal said.
“The problem is not the shift to GST, for which you are asking for compensation, the problem is that the economy got hit with a shock which was unexpected. So, it’s not like the central government has a moral obligation to make up for a Covid shock,” he said.