Time to reboot the economy

Time to reboot the economy

America has not faced the number of deaths as it sees now, ever in its history. The toll is worse than 911 and Pearl Harbor combined.

Coronavirus has shaken the world economy and the US has been the worst hit. No doubt Trump is trying his best to handle things but this leaves a big question of how America, a global leader, and the fully developed country has had to struggle without basic safety equipment in its emergency medical supplies.

We need to really rethink where we went wrong. The push for bringing jobs back to America also makes sense and the timing cannot be better.

However, the recent pressure to cancel or suspend H1B visa holders by four influential senators does not hold right. Freezing of these visas will not only affect Indians working there but will starve the US of highly skilled labor. No doubt the US needs to save jobs for its citizens yet it needs balanced handling of the situation. US universities, which attract students from all over the world, bring home billions of dollars as well as, create jobs in the universities.

Many graduates look for opportunities and settle down on the completion of their education. America’s strength lies in its policy to induct highly skilled talent from all over the world and if they have to return it will be very hard to replace them. The same goes for the Mexican labor force that remains the backbone of US agriculture. The main sectors for US job creation are automobile and defense, plus retail and hospitality. Trump had done well to bring unemployment numbers down until the pandemic.

Every country will be planning to reboot its economy.

India has the best opportunity to restart the economy by opening up its borders to countries that want to invest in manufacturing and also looking for the domestic consumer base. India like China has one of the largest domestic consumer bases and this by default is India’s advantage. But Modi needs to act rapidly as other neighboring countries are also wooing for similar opportunities. Some industries have already decided upon Vietnam, Myanmar, and Indonesia.

India needs a skilled labor force and the government of India is in no position to fulfill this task. It requires private players to kick start with industry-specific training programs, where investors are interested and in the removal of bureaucratic hurdles to do business.

I think Modi has handled the pandemic well. His leadership has shown positive results with people across the country supporting the protocols and guidelines of the lockdown. He needs to totally revamp the financial system, mainly banking and lending institutions, providing affordable loans made easily available to MSME units (Micro, Small & Medium Enterprises).

Once the economy picks up consumers will automatically move towards investing in housing and other durables. Real estate has been hit hard and it needs a huge stimulus to get back up again. This sector employs a very large labor force and India also needs to especially promote affordable housing for the poor.

Successive governments have been promising but India has failed for the last 70 years, to address basic needs for its poor. The gap between haves and have-nots has increased, and if India wants to become a $5 trillion economy it needs to take care of this segment along with other development.

India has a golden opportunity to not only reboot its economy but also to lift the downtrodden segment of society forever and give them equal opportunities in education, healthcare and a life of dignity.

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