IMPORTANCE OF 20 L STIMULUS PACKAGE PART 1

Everyone is discussing the stimulus package. Rather they are discussing entitlement which they are used to getting earlier.

Now our view on the has been divided into two parts:

1. Front side loading

2. Back-end loading

Today we are only discussing opportunities utilized by GOI in front loading.

It's a universal truth that we all are consumers. It is also true that our country has two divisions.

1. Urban

2. Rural

 In the present scenario, most business establishments have a base in the urban part. There is a lot of problems here with zones, labor as well as the sentiment. Lots of people are losing jobs rather a right sizing by the company as per their assessment as well as the mass exodus of labor to reach their home town or village.

Here stimulus has been given by way of PF contribution. Which is significant. But the majority of enterprises had paid salaries to their employees plus their own expenses are less due to lock-down. So there is money with consumers but everybody is waiting for clarity.

Now after the step-wise opening of lock-down, transactions have been started & people are coming for marketing of nonessential goods. (Not in mass)

In rural parts, post-harvest payments received by farmers are making them pay their dues as well as the purchase of new goods.

Now major demand in the company is coming from rural part.  The budget increased for MNREGA,  migrant labor will get jobs in the form of MNREGA  which means labor will get money to spend. Also, assets will be created which will have a compounding effect in the future.

There is a pain as the partial lock-down has been lifted.

But not more than 25 to 45 days will require to get exact directions. 

But front side loading data demand side loading in there.

In the next part, we will go through back-end loading.
Location: India

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