By Prerana Jhanwar

The year 2020-21 has felt like a rollercoaster ride indeed, be it for India’s stock markets or its GDP. With the advent of Covid and the economy shrinking by a record 24% in Q1, it indeed felt like a dark year in the history of India’s economy. However the mass public cooperation and the stringent decisions taken by the government had indeed given hopes to the citizens that brighter days are on their way. The unfortunate impact of the second wave has again put the nation in a state of emergency however looking back, it would be wrong not to commend the government  on its actions which drove the growth in 2020. Some of these are listed below.

1. Abolition of DDT: The government in a drive to raise investor sentiment and encourage capital investments have ruled to abolish the tax on distributed dividends. Apart from the taxation on distribution, dividend above 10 lacs was taxed in the hands of investors. Further the surcharge on divided has been restricted to 15% as a relief to the HNIs.

2. Emergency Credit Guarantee Scheme: 20% of the total outstanding credit of borrowers can be sanctioned as a loan under the Guaranteed Emergency Credit Line. Furthermore, collateral requirement has been waived under this scheme and charges like processing charges, foreclosure and prepayment charges have also been waived.

3. The PM Kisan scheme has been expanded which directly transfers money to farmers in a targeted way.

4. Personal Income tax regime has been simplified with the rates being systematically reduced. A move towards streamlining the tax code.5. There’s a saying which goes, ‘you can never spend your way out of a recession.’ Following this, the Indian govt restrained the temptation to print and spend ensuring that the economy shall find its way to resilience and eventual prosperity. India’s effective COVID stimulus is estimated around 2% of its GDP as compared to 13% in US, 21% in Japan, 14% in Australia, 12% in Brazil and 7% in China (statista.com), making it one of the least stretched countries post COVID.