India Inc better prepared to limit Omicron impact on economy to bare minimum: ASSOCHAM

New Delhi: Indian industry, across different sectors, is far better prepared to remain functional during the ongoing wave of Omicron variant of Covid 19 than the first and second quarters of FY ’22, ASSOCHAM has said with cautious optimism.

 

“Less severity of Omicron, seen as of today, has helped the governments and the industry to remain confident about India’s ability to come out of the current phase of the pandemic with a minimum of impact on the economy,’ said ASSOCHAM Secretary General Mr Deepak Sood.

 

He said an impressive coverage of the country’s vaccination programme has added to the industry’s confidence to deal with the evolving situation. ” Including teens of 15-18 years of age along with booster for the senior citizens in the vaccination programme would give further comfort to the consumers and the industry.

 

While several sectors of the economy like exports have bounced back, there is a need for staying cautious and optimistic in the wake of Omicron spreading fast all around the world. The impact on the economy should be to a minimum, while hazarding a guess for the medium term would not be advisable at this point of time.

 

Though in operation, the contact services such as hotels may have to keep innovating to live up to the challenge in the wake of off and on restrictions on travel, business timings etc.

 

“ASSOCHAM would urge the government and the RBI to continue with some of the forbearances for these sectors, including the MSMEs, to face the new head winds, Mr Sood said.

 

He said the industry is expecting critical measures in the ensuing Budget for boosting consumption and relief to the sectors continuing to get affected by the pandemic. ”We expect a big focus on public health infrastructure and on reviving rural demand along with a large spend on infrastructure”.

 

RBI too would need to strike a fine balance between retaining low interest rates and keeping inflation within the targets of 4 per cent (plus/minus two per cent).

 

While the RBI has navigated the interest regime with a remarkable pragmatism keeping it low, rising inflationary pressures would require out of the box solutions. “We are sure, the RBI has several innovative tools to continue with the accommodative stance on interest rates”.