The Telangana Chief Minister K Chandrashekhar Rao, during the four-hour video conference meeting with Prime Minister Narendra Modi on Saturday, urged him to extend the nationwide lockdown for another two weeks. The CM also called for economic support to farmers and wanted the PM to allow key agriculture-based industries to function.
The lockdown has helped to contain the spread of coronavirus disease to a great level. It is better to extend the lockdown for two more weeks. There is no other better solution than this, KCR told PM Modi.
The CM said that to ensure farmers don’t incur losses and there is no shortage of supply of essential commodities, the food processing industry should be allowed to function. “The lifeline of our country is agriculture. It not only provides food to people, agriculture also is the source of livelihood to many. It’s not possible for any country to feed India with its 135-crore population. We are self-sufficient as far as food grains are concerned. This situation should continue. We have to stand by the farmers who feed us,” said KCR at the meeting attended by Chief Ministers from all states.
He also said that measures should be taken to run rice mills, oil mills, and other agriculture-based industries.
KCR further urged the PM to consider linking agriculture with the MNREGA. “This scheme should continue for at least two months. Bring a policy by which farmers would pay half the wages of labourers and the other half would be from the MNAREGA funds. With this, we will be able to support farmers at the difficult times,” he added.
KCR also floated the idea that states should procure agricultural yield directly from farmers.
He suggested that states could supply rice through the public distribution system (PDS) for the next three months, thus emptying the excess stock at FCI (Food Corporation of India) godowns. The godowns could be restocked again with grains procured by all states from farmers directly.
Post lockdown, the Telangana state set up 6,849 procurement centres at the village level and the food grains are procured by the state from villages to avoid overcrowding at agricultural market yards. For the procurement of paddy alone, the Telangana government has given Rs 25,000 crore bank guarantee to farmers. “We are procuring paddy in the villages and depositing money in the accounts of the farmers directly. The paddy thus procured is made into rice and supplied to the FCI. To get money from the FCI it will take four to five months. Till such time, the Centre should take measures so that banks would not put any pressure for the payment of dues,” suggested the CM.
KCR also suggested the creation of a task force under the chairmanship of the PM to prepare an action plan on how to help farmers.
To counter the economic fallout of coronavirus and the extended lockdown, KCR said there is a need to develop a strategic economic policy. “RBI should implement quantitative easing policy. This is called Helicopter money. This will facilitate states and financial institutions to accrue funds. We can come out of the financial crisis. Release 5% of funds from the GDP through Quantitative easing Policy,” KCR said.
Quantitative easing is an approach where a country’s central bank, in this case the RBI, buys financial assets in order to increase the supply of money in the economy, thus giving banks more capability to lend.
The Telangana Chief Minister also suggested the Centre to allow states to increase their borrowing capacity by increasing the fiscal deficit gap between total expenditure and revenue, from the present 3% to 5% of the GDP. The easing of the Fiscal Responsibility and Budget Management (FRBM) Act would effectively allow the states to borrow more.
The Centre should take initiative to postpone for six weeks, the monthly interest paid by the States on debts from the Centre, KCR further suggested.