Chief Economic Advisor Krishnamurthy Subramanian says the economic impact of the third wave is expected to be much softer than that of the lockdown last year, and the second COVID wave. This is because vaccination numbers are rising and the states and the Centre have learnt to contain lockdowns better.
“So, in itself, the health impact of the third wave may be much less than the second wave. The second wave’s economic impact was much lower than the first wave. When you take all of them into account, I think the third wave’s economic impact may not be very large,” Subramanian said in an interview with Moneycontrol.
Subramanian also said that the credit guarantee schemes to small individual borrowers as well as various sectors can be treated as quasi-income support, while effectively ruling out fiscal measures, apart from the ones announced in the budget, which, he said, will have a much larger multiplier effect on economic activity, consumption and job creation.