Actually, it will have to be a mix of monetary measures and fiscal measures that will be required at this point of time. This must be done fast so that early signs of slowdown do not aggravate into something big. Here are some monetary and fiscal ideas.

· The first thing required is big cuts in repo rates. Real interest rates in India at above 4.25% are among the highest in the world.

· Banks need capital to lend and the government has to infuse a lot more capital into banks. That is the only way output is going to pick up.

· The third monetary measure is to make liquidity easily available to the stressed sectors like NBFCs, realty segment, auto dealers, auto ancillaries etc. Low rates and abundant liquidity are the answers and they must be done on priority basis.

· Firstly, India will have to give up its obsession with FRBM and adopt pump priming as a conscious strategy. This is normal in most economies.

· Government has to sustain spending on projects for infrastructure, more of helicopter money payouts and aggressive tax cuts.

· The key is to revive spending because it creates virtuous cycle. If GST cuts and income tax rebates can spur spending, then it is absolutely worth the risk. Spending spurs earnings and jobs and is an absolute must.

The slowdown has just begun and it is essential to act fast. It is only when spending returns, that the slowdown challenge will be addressed!