On Thursday, Finance Minister Nirmala Sitharaman announced the second tranche of Modi government’s “Atmanirbhar Bharat Abhiyan” package worth Rs 20 lakh crores to restart the economy following the coronavirus lockdown.
Finance Minister Nirmala Sitharaman had announced comprehensive relief measures on Wednesday to support various sectors including Micro, Small and Medium Enterprises, Discoms, NBFCs, Micro Insurance Institutions, etc. The Modi government had also announced various relief measures for real estate sectors and also extended deadlines for various taxpayers.
The Finance Minister Sitharaman had said the announcements will be made in many tranches. In the first tranche, Modi government had announced 16 included six measures for MSMEs, 2 for EPF, 2 for NBFCs and MFIs, 1 for discoms, 1 for contractors, 1 for real estate sector, and 3 tax measures.
Second tranche of announcements under “Atmanirbhar Bharat Abhiyan” economic package
Finance Minister Sitharaman on Thursday said that the second tranche will be relating to migrant workers, street vendors, housing, employment generation for tribals and small farmers. A total of 9 steps will be announced today, she added.
“There are nine steps that will be announced – three for migrants, one for street vendors, one on housing, one on employment generation for tribals, two for farmers etc,” said Finance Minister.
The Finance Minister also said that the Modi government, within hours of announcing Lockdown 1.0, had come up with the PM Gareeb Kalyan Yojana, to provide money and food to the poor. “This may not be the last one though, we may come back and announce more”, clarified Finance Minister.
Relief for Farmers and Rural Economy
Union Finance Minister Nirmala Sitharaman announced that 3 crore marginal farmers have availed agricultural loans worth over Rs 4.22 lakh crore. These farmers, who availed the loans through the RBI, were initially given an interest moratorium of three months, which has now been extended till May 31, 2020.
25 lakh new Kisan credit cards holders have been sanctioned with a loan limit of Rs 25,000 crore, added Sitharaman. She added that Interest Subvention and Prompt Repayment Incentive on crop loans, due from March 1, has been extended up to May 31 2020.
Finance Minister also announced additional liquidity support for farmers and rural economy. FM Sitharaman said that 63 lakh loans worth Rs 86,000 crore have been approved and refinancing of Rs 29,500 crore has been provided by NABARD to cooperative and rural banks in March.
She added that more than 6,000 crores have been provided to state agencies for agricultural procurement. Support of Rs 4,200 crore provided under Rural Infrastructure Development Fund to states during March 2020 for rural infrastructure, she announced.
The Modi government also sanctioned working capital limit of Rs 6,700 crore for procurement of agriculture produce to state government entities.
Support for Urban poor
To reach out to the urban poor, the Modi government has permitted states to utilise the State Disaster Response Fund (SDRF) to set up shelters for migrant labourers and provide them food and water, said Finance Minister.
“At least Rs 11,000 crore was sent for this purpose. We are taking care of them,” said FM Nirmala Sitharaman.
The central government has supported self-help groups, which have produced 3 crore masks, 1.20 lakh litres for sanitizers. FM Sitharaman also said that the Modi government has provided employment opportunities to the urban poor through SHGs. Further, 7,200 new SHG have been formed since March 15, 2020 to generate employment, she added.
Relief for Migrants
Finance Minister said that the Modi government is supporting migrant labourers who have returned to their home states by creating work under the MNREGA. She added that the government is planning plans to continue MGNREGA work during the monsoon – plantations, horticulture, livestock-related work.
“For migrants who are going back home, we have generated 14.62 crore person-days of work, which is 40-50% more than before the coronavirus lockdown. We have enrolled them 2.33 crore wage seekers in 1.87 lakh gram panchayats who via MGNREGA will get enrolled and get jobs. They will be actively engaged, annual expenditure is Rs 10,000 crore, we will provide for more if needed,” said Finance Minister Sitharaman.
Average wage rate rose to Rs 202 from Rs 182 in last Financial Year, said Finance Minister. FM Sitharaman also said that a drive being undertaken to enrol returning migrant.
Finance Minister said that migrants who are neither NFSA or state card beneficiaries in the state they are stationed will be provided 5 kg of grains per person and 1 kg chana per family per months for two months. The government has allocated Rs 3,500 crores allotted to 8 crore migrants.
This will be done through the states, which are aware where the migrant workers are currently staying, added Finance Minister.
FM Sitharaman said that the Modi government will implement ‘One Nation One Ration Card. The scheme will cover 67 crore beneficiaries in 23 states covering 83% of the PDS population. The beneficiaries will be covered by national portability by August 2020.
“In order to benefit migrants, the govt is coming up with the National Portability Cards (One Nation One Ration Card) which can be used in any ration shop in any part of the country as migrants move from state to state,” Finance Minister said.
This initiative is a technology-driven system, as announced as a pillar of the ‘Atmanirbhar Bharat Abhiyan’ by Prime Minister Narendra Modi on Tuesday.
For migrants and the urban poor, the government has announced affordable rental accomodation under PM Awas Yojana.
“We are incentivising manufacturing and industries to build affordable housing units on their properties and looking to convert vacant buildings in metro cities for housing. This will be done via PPP mode through concessionaire agreements – which will constitute small rents and then make up, similar to the road toll. Detailed guidelines will come from ministry soon,” said Finance Minister.
Labour codes: Benefit for workers
Finance Minister Nirmala Sitharaman added, “We are committed to making labour codes for workers welfare and our agenda is their welfare. Minimum wage will become universal – this is what we are working on. Removing regional disparity in minimum wage thorough national floor wage concept is on the table.”
Compulsory appointment letters and annual health check-ups will be made mandatory and inter-state migrant workers will be defined so that they can better receive initiatives, FM Sitharaman announced. Portablity of welfare benefits is being considered, the Finance Ministry added.
“ESIC benefits are being looked at expanded to all establishments, even for those with less than 100 employees and for establishments with 10 or less employees will be voluntary. We want to make ESIC coverage mandatory for small units where workers are engaged in hazardous jobs.”
The Modi government also said that re-skilling of retrenched workers will be looked at and also issued a diktat that all occupations should be open for women with night working rights, social security for unorganised sector workers.
Interest Subvention on MUDRA – Shishu loans
The government has also announced the following for small businesses under the MUDRA scheme, which has been disrupted the most due to the coronavirus, and, in turn, do not have the capacity to pay EMIs. Finance Minister announced Rs 1500 crore interest subvention for MUDRA-Shishu loan
“A Loan moratorium has already been granted by RBI. The current portfolio of MUDRA-Shishu loans is Rs 1.62 lakh crore. The Modi government will provide interest subvention of 2% for prompt payees for 12 months,” said Finance Minister. This will be a Rs 1,500 crore benefit, said FM Sitharaman.
Relief for Street vendors
FM Nirmala Sitharaman also announced relief measures to support 50 lakh street vendors. For street vendors, the government has announced Rs 5000 crore special credit facility.
The Modi government also announced that it will launch special scheme within a month to facilitate easy access to credit to street vendor. The initial working capital up to Rs 10,000, said FM Sitharaman.
“Digital payments will be incentivised through monetary rewards and enhanced working capital credit would be made available for good repayment behaviour. Will provide liquidity of Rs 5000 crore,” said Nirmala Sitharaman.
Special measures for Housing
Finance Minister also announced some relief measures for middle income group with annual income of Rs 6-18 lakh as the credit linked subsidy scheme introduced in May 2017 which was to last till March 31, 2020 will be extended to March 31, 2021.
“Over 3.3 lakh families previously benefited, and additional 2.5 lakh middle income families will join in. Jobs creation, steel, cement and heavy duty material will improve. Will have immediate impact on demand-side,” said Sitharaman.
“This wil lead to investiment over Rs 70,000 crore in housing sector, said FM Sitharaman
Support measures for Tribals/Adivasis
Finance Minister said that employment creation will be done in tribal areas through Compensatory Afforestation Fund Management and Planning Authority (CAMPA) funds.
“The government says it has already received proposals worth Rs 6,000 crore to help generate employment for tribals and Adivasis for afforestation and plantation works, artificial regeneration etc. Considering the monsoon is approaching, these projects will kick off soon,” added Finance Minister.
Support for Farmers
In support for farmers, the Modi government announced various measures including Rs 30,000 crore additional emergency working capital fund through NABARD.
Finance Minister announced that through KISAN Credit cards, 2 lakh crore will be made available to 2.5 crore farmers giving them access to institutional credit. She added Regional Rural Banks and Rural Cooperative banks will be the main source for credit and NABARD will extend additional refinance support of Rs 30,000 crore for crop loan requirement of rural coop banks and RRBs.
FM Sitharaman said that the additional emergency working capital fund through NABARD will be immediately released for small and marginal farmers so that post-harvest rabi produce and preparatory work for Kharif crops are supported. State cooperative banks, district cooperative banks and regional rural banks have been roped in. Will directly reach and benefit 3 crore rural farmers, said FM.
“Fishermen and animal husbandry farmers will be considered under this scheme. Will seek to enrol more farmers for KISAN cards so that they benefit,” said Sitharaman.
‘Atmanirbhar Bharat Abhiyan’ – A mission for self-reliance
In his fifth address to the nation over the Coronavirus pandemic, on Tuesday Prime Minister Narendra Modi announced an economic package under ‘Atmanirbhar Bharat Abhiyan’ amounting Rs 20 lakh crore to revamp the economy which is facing a serious crisis due to the Chinese epidemic. The economic package includes the recent announcements made by the government and the Reserve Bank of India on supporting key sectors of the country.
In his speech, PM Modi said the economic package would be around the 10 per cent of the GDP.
“I announce a special economic package today. This will play an important role in the ‘Atmanirbhar Bharat Abhiyan’. The announcements made by the government on coronavirus, decisions of RBI and today’s package totals to Rs 20 lakh crore. This is 10 per cent of India’s GDP,” PM Narendra Modi said.
The Prime Minister also said the package would help every section of society, including workers, farmers, the middle class, industrial units and the MSME sector.
The stimulus will play an important role in the ‘Atmanirbhar Bharat Abhiyan’ (Self-reliant India Campaign), PM Modi said.
“India’s self-reliance will be based on five pillars — economy, infrastructure, technology-driven system, vibrant demography and demand. When India speaks of self-reliance, it does not advocate for a self-centred system. In India’s self-reliance there is a concern for the whole world’s happiness, cooperation and peace,” PM Modi said in his address.