Senior Congress leader P Chidambaram urged the government to set forth a scheme similar to the “paycheck protection program” in the United States in order to safeguard the salaries and wages of 12 crore employees who find themselves unemployed amidst the nationwide coronavirus lockdown.
The former finance minister at a press conference via video conferencing said, “Time is of the essence. In the absence of a clear signal of assistance from the government during these extremely difficult times, the private sector will be forced to resort to large scale retrenchments and layoffs, which will devastate livelihoods of hundreds of millions of people.”
He further continued, “We urge the prime minister to step in urgently and announce an assistance package to protect the wages/salaries and pay cheques that are due in the next few days,” urging the government to ensure that salaries for the month of April of workers in both in the MSME and non-MSME sectors are paid.
The Paycheck Protection Program (PPP), that the senior Congress leader recommended is a loan program that falls under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was passed in the US House and Senate in March 2020. It is almost a $350-billion program and means to provide loans to businesses so that they can guarantee eight weeks of payroll and other costs to help them and their workers remain viable and paid.
Voicing the Congress Party’s stand on the MSME sector, Chidambaram urged the centre to announce a second financial package specially for the sector and give financial assistance to all states so they can better fight the novel coronavirus pandemic. This is in line with the letter Congress president Sonia Gandhi had written to Prime Minister Narendra Modi on April 25 asking him to declare a financial package for the revival of the MSME sector — including reserving Rs 1 lakh crore each for ensuring protection of wages and for setting up a credit guarantee fund.
Chidambaram further questioned the government on why it had taken the technical loan write-off route for wealthy and obnoxious fugitives like Nirav Modi, Mehul Choksi and Vijay Mallya. This comes in the backdrop of the recent RTI revelation that prominent activist Saket Gokhale sent to the RBI. The RTI exposed the list of top 50 defaulters in India whose unpaid loans come up to Rs 68,607 crore. After the revelation, senior Congress leaders like Rahul Gandhi and Randeep Singh Surjewala had slammed the central government on why they waived off Rs 68,607 crore worth of loans.
While agreeing that one cannot deny the rule that banks can write-off loans technically and recoveries can continue against willful defaulters, Chidambaram questioned the government on why the rule was applied to fugitives like Nirav Modi, Mehul Choksi and Vijay Mallya.
“One is not denying such a rule that can be applied to a wilful defaulter. But, we are asking these are fugitives and they have left the country and are absconding. Why are you applying this rule to Nirav Modi, Mehul Choksi and Vijay Mallya,” he said.
“When they are fugitives, the technical rule in the book should not be applied to them. That is my view,” he added.