Pandemic Economic Response — Policy Reforms

Entry	Year	Description	Impact
N/A (Statutory Invocation)	2020	While not a constitutional amendment, the 'escape clause' under Section 4(2) of the Fiscal Responsibility and Budget Management (FRBM) Act, 2003, was invoked. This statutory provision allows the government to deviate from fiscal deficit targets under exceptional circumstances, such as national calamities or economic downturns. The pandemic qualified as such an event.	Enabled the Union Government to undertake significantly higher borrowing and expenditure than mandated by the FRBM Act's fiscal glide path. This provided the necessary fiscal space for large-scale relief and stimulus packages, preventing a deeper economic contraction but leading to a substantial increase in public debt and fiscal deficit for FY21 and subsequent years.
N/A (Regulatory Changes)	2020-2021	The Reserve Bank of India (RBI) introduced several regulatory changes and forbearance measures under its existing powers, rather than requiring specific legislative amendments. These included a moratorium on loan repayments, a one-time restructuring framework for COVID-19 related stressed assets, and temporary relaxations in asset classification norms.	Provided crucial relief to borrowers (individuals and businesses) by deferring EMI payments and allowing for loan restructuring, thereby preventing a surge in non-performing assets (NPAs) for banks. This helped maintain financial sector stability during the crisis, though it also masked the true extent of stress in some sectors temporarily.