Fact Check of PM Modi's Announcement of Rs 20 Lakh Crore Corona Package

Yesterday late evening, on 12th May, our PM Modi announced new corona crisis economic package for the year 2020 worth Rs 20 lakh crore, i.e., almost about 10% of India's GDP. According to him economic gains India had so far would now enable her to spend 10% of GDP to lead India further to the path of self reliance. The PM also appreciated the will power and self confidence of the people in the moment of crisis situation of pandemic. How he saw will power and confidence in daily wage migrant labourers is of anybody's guess.

He said that details of the new package will be announced by FM Nirmala Sitharaman in the coming next few days starting today the 13th May.

In the absence of package details 

1. We can atleast draw a list of percentages of GDP offered to their respective citizens by other countries as relief packages.

2. We must analyse the figure 10 % which, in itself, seems to be an impressive share of India's GDP going to be spend but in reality the new package is a perfect eye wash!!!

On surface, India's corona relief package of 10% of GDP is not less impressive if compared with other countries like USA 13%, Sweden 12%, Japan tops the list with 21%, Malaysia 17%, Germany 10.7% and so on.

Now the point is if our GDP shrunk from USD 3 trillion which equals to INR 210 lakh crore to even less that comes to around INR 200 lakh crore which makes 10%  of GDP INR 20 lakh crore. But if we refer to our budget FY 20-21 the GDP is expected to be INR 204 lakh crore as per current price index. Hence 10% of INR 204 comes to around 20 lakh crore.

Now there is also a punch. All announcements of packages made earlier are also included in Rs 20 lakh crore. The farmers who were supposed to be paid in June this year were paid in April a total Rs 1,00,000 crore  out of Rs 1,70,000 crore as direct benefit transfer through Pradhan Mantri Garib Kalyan Yojna.

PM spoke about 4 Ls - Labour, Law, Land and Liquidity. In the last labour law reforms many changes and alterations were made to suspend legal reforms, which damaged many of the rights of labour. As far liquidity is concerned one must know that it means how much money RBI is going to loan out to banks. RBI has already loaned out out Rs 8 lakh crore to banks. Balance remains Rs 12 lakh crore to be loaned out to make it Rs 20 lakh crore. 

Recently when debt fund of mutual fund of Franklin Templeton collapsed, in the very first week of this month  RBI proposed to offer Rs 50,000 crore for banks to help and save mutual funds from collapse. Only 5% of Rs 50,000 crore was lifted by banks as banks were not sure of recovering their money disbursed as loans. So all such liquidity packages offered by RBI to banks are lying unutilized as banks are not disbursing loans for the risk of NPAs due to non-recovery. Hence banks are very cautious of taking loan benefits offer by RBI.

Is allocation of Rs 10,000 crore for NREGA is part of the budget or additional loan disbursement fund or added into Rs 20 lakh crore is not clear yet.

Around Rs 1,10,000 crore was allocated for District Development Fund and another one  for insurance of construction workers. Whether these funds will also be included in Rs 20 lakh crore is not clear.

A provision for 5 lakh crore loan is most likely to be made by RBI only to be disbursed to MSMEs through banks against which government will stand guarantee for 50%.

Hence adding up all above 8.0+0.50+1.7+1.1+5.0 government's additional expenditure or inclusion of funds in 20 lakh crore is going to be 4.5 lakh crore which comes to 2.5 % and not 10% of  GDP. Just see what an eye wash. Does the government think the country is a collection of fools? Are we fools so as not to understand Modi's ever practice of jugglery?

This government is shamelessly a master lier.

Modi was also rather incorrect to claim that PPE kit is now manufactured in India and for this he felt, corona virus outbreak has given an opportunity to do so. To put the record straight, PPE kits were not only manufactured in India but also exported earlier, much before corona virus hit India.

PM Modi made mention of Y2K computer failure due to the "millennium bug" during 1998 and 1999. The PM was referring to the computer programmes written by the programmers were designed to fail in the year 2000. Predictions which were more or less fake to create a worldwide choas on January 1, 2000, as it was deposed that the computers programmed with two-digit year fields would mistake it to be 1900.

As a result it was also predicted nuclear power grids may fail, and interrupt all the services that depend on computer, including water supplies. All kinds of devices with embedded processors may fail, such as elevators, printers, and navigation satellites. 

But as a matter of fact such was not solved or debugged by india as claimed by and to make the nation believe in "Dr. Modi's" deposition yesterday.