Offer immediate liquidity to the services sector: Crisil

Mumbai: Calling for urgent liquidity support to the worst-hit services sector, Crisil has opined that only a mix of monetary and fiscal boosters can help the economy tide over the deepening impact of the Covid-19 pandemic.

Immediate short to mid-term liquidity support to airlines, hotels, malls, multiplexes, restaurants and retailers is needed as they are in the high-risk category with the steepest revenue loss, says a report by Crisil economists and analysts.

Their call is despite an admission that the government "has little policy firepower to give a meaningful push to growth and the pandemic is making it more difficult" and therefore a "mix of monetary and fiscal policy measures necessary to cushion demand fall."

In the best-case scenario, supply-chain normalization is possible only by end May provided the rate of new Covid-19 cases continues to fall in China, they say while warning that if that does not happen, then other sectors like steel, gems & jewellery, construction & engineering, and textiles would be hit.