‘Falling Oil Prices Boon for India’

Amid the weeks-long nation-wide lock-down aimed at maintaining social distancing to keep the highly infectious Covid-19 pandemic at bay and in the wake of huge relief announcements made by the Indian finance minister to tackle an unprecedented health crisis, a noted India-born economist has said that the Centre is in a good position to help the poor who are in dire straits.

“The government is surely helped by the falling oil prices. Our oil bill is about 15 billion dollars lower for every 10 dollar per barrel oil price drop — this translates into about a 50-billion-dollar windfall for the year,” explains Johns Hopkins University economist Pravin Krishna.

“It is obvious that we are in an extremely challenging situation now,” points out Krishna, who is an academic collaborator of noted economists Jagdish Bhagwati and Arvind Panagariya, two global academics who brought the Narendra Modi-led Gujarat-model of economic development to international attention through their works and speeches.

Krishna is Chung Ju Yung Distinguished Professor of International Economics and Business at the School of Advanced International Studies and the Department of Economics in the Zanvyl Krieger School of Arts and Sciences at Johns Hopkins University.

Finance minister Nirmala Sitharaman announced a Rs 1.7 lakh crore relief package on March 24 to help the economy and people sail through the 21-day lockdown that started on March 24. The relief measures announced include direct cash transfers. Our package will take care of the welfare concerns workers and those who need immediate help, Sitharaman said.

According to the government, it will provide three free cooking gas cylinders for the next three months under its Ujjwala Scheme, which it said will benefit 8 crore BPL families. The relief measures also include medical insurance cover worth Rs 50 lakh per person for those putting their own life at risk of Covid-19; these include doctors, paramedic/healthcare workers, ASHA workers and others dealing with the disease outbreak. The government says 20 lakh people will benefit from this scheme. The Centre estimates 80 crore people will benefit from Rs 1.7 lakh-crore package under PM Garib Kalyan scheme. The government also announced a slew of other programmes that it said will benefit farmers, migrant workers, women and others.

Krishna is an alumnus of Columbia University and Indian Institute of Technology, Bombay. He was previously Professor of Economics at Brown University and has worked at Princeton University, Stanford University and the University of Chicago.

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