FM Announces New Measures To Boost Economy, Unveils 1.1 lakh Crore Loan Guarantee Scheme For Covid-19 Affected Sectors

Union Finance Minister Nirmala Sitharaman has announced some new relief measures amid economic distress caused by the second wave of COVID-19 in the country. The FM announced loan guarantee scheme for Covid-affected sectors. A total of Rs 1.1 lakh crore of loan guarantee scheme for Covid-affected sectors has been announced. Health sector will get Rs 50,000 crore aimed at up scaling medical infra, specially targeting underserved areas. The guarantee cover is for expansion of new projects under health, in other than 8 metro cities. Guarantee coverage is of 50% for expansion and 75% for new projects. Guarantee duration will be up to 3 years while interest rate has been capped has been capped at 7.95%; normal interest rate without guarantee cover is 10-11%. Other sectors Rs 60,000 crore with interest rate capped at 8.25% p.a.

The FM provided an additional Rs 1.5 lakh crore for Emergency Credit Line Guarantee Scheme or ECLGS. The ECLGS 1.0, 2.0 and 3.0 resulted in disbursal of Rs 2.69 lakh crore to 1.1 crore units by 12 PSBS, 25 private sectors banks, and 31 NBFCs. The contact intensive sectors coverage will be continued while Rs 4,000 crore have been given so far.

The FM announced a credit guarantee scheme through MFIs. The scheme is set to facilitate loans to 25 lakh people though micro finance institutions and will be provided to scheduled commercials banks for loans to new and existing NBFCs and MFIs for lending up to Rs 1.25 lakh. The interest rate on loans capped at MCLR plus 2%.

To revive tourism industry, the FM announced financial support to more than 11,000 registered tourist guides and travel and tourism stakeholders. Under new loan guarantee scheme for Covid-affected sectors, loans will be proved to the tourism sector. Loans will be provided with 100% guarantee, up to Rs 10,00,000 for TTS per agency, and Rs 1,00,000 for licensed tourist guides. No processing charges or waiver of foreclosure charges and no additional collateral will be needed. Once visa issuance is restarted, first five lakh tourist Visas will be issued free of charge.

The Atmanirbhar Bharat Rozgar Yojana extended from 30/06/2021 to 31/03/2022. The scheme incentivizes employers to create new employment through EPFO. The FM Approved outlay at Rs 22,810 crore for 58.50 lakh estimated beneficiaries with monthly wages less than Rs 15,000. A total benefit of Rs 902 crore has been given to 21.21 lakh beneficiaries of 79,577 establishments so far

The FM provided additional subsidy for DAP and P&K fertilizers, as announced earlier. The NBS Subsidy increased to Rs 42,275 crore in FY 2021-22 while existing NBS subsidy was Rs 27,500 crore in FY 2020-21. An additional amount of Rs 14,775 crore is to be provided, including for DAP and NPK-based complex fertilizers. Record procurement seen of 432.48 lakh MT of wheat in Rabi marketing season (RMS).

The Pradhan Mantri Gareeb Kalyan Anna Yojana has been extended due to the second wave of Covid-19. FM noted that 5 kg food grains will be freely provided to NFSA beneficiaries from May to November 2021, having financial implications of Rs 93,869 crore and taking total cost of PMGKAY to Rs 2,27,841 crore.

The FM said Rs 23,220 crore more for public health for one year have been earmarked. The New scheme will be focused on short-term emergency preparedness with emphasis on children and paediatric care. The FM plans to increase ICU beds and oxygen supply at central, district and sub-district levels.

The FM noted that the govt will be releasing climate-resilient verities with special traits, as earlier focus was on developing higher yielding crops. She announced that Rs 88,000 crore will be infused through equity in Export Credit Guarantee Corporation (ECGC) over five years and revealed plans to boost export insurance with products that support around 30% of India's merchandise exports

For Digital India, the FM provided an additional Rs 19,041 crore for BharatNet. The total outlay will be Rs 61,109 crore, including already approved amount Rs 42,068 crore in 20. She also offered extension on tenure of PLI scheme for large scale electronics manufacturing. Tenure of the scheme launched in 2020-21 will be extended by one year i.e. till 2025-26. Companies will get options for choosing any five years for meeting production targets

Powered by Capital Market - Live News