The RBI delivered on the government’s announcements. Another rate cut extended moratoriums on loans until August 31st, and changed credit exposure limits to large business groups, sound a clear pro-growth message.

This is good news at a time when the GDP growth outlook is negative, urban stress seems to be here to stay, developed states are more affected than developing states, and agriculture is the lone saviour of the economy. This situation has no parallels or precedents.

Governments always found strength in areas of the economy outside agriculture. We urbanised and industrialized hoping to absorb people leaving agriculture. The reverse migration of people from industrialized states back to states of their origin throws up a problem we never prepared for. But problems seed newer opportunities and governments must respond to every emerging situation. On one hand, the government will need to support economic recovery in the industrialized state. On the other, it must avert any growth in economic stress in developing states. Agriculture will provide economic resilience across the country. The government’s immediate focus will be building confidence in other parts of the economy.

The coming weeks must see traction in the government’s efforts to normalize the industrialized states.

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