Union Finance Minister Nirmala Sitharaman, on Monday, announced a relief package to give a fillip to the economy, and provide a helping hand to those who have been affected most by the pandemic. A total of 17 measures, amounting to Rs. 6.28 lakh crore, were announced.
These measures can be clubbed into three broad categories—economic relief from pandemic, boost to public health, and impetus for growth and employment.
While some of the measures were continuation of the Aatmanirbhar Bharat package announced last year, after the debilitating second wave, some of Sitharaman’s relief package was intended for those in the non-metros cities. The second wave had wrecked havoc in smaller cities and rural areas.
The minister announced Rs 50,000 crore for the under-served areas to boost health infrastructure. A loan of maximum Rs 100 crore will be provided for expanding existing facilities, and setting up new ones. The government will give guarantee cover for three years with interest being capped at 7.95 per cent.
For other sectors, which includes tourism, while a list is being drawn up, Rs 60,000 crore has been earmarked as loan with interest rate capped at 8.25 per cent.
As the third wave is expected to affect children, the finance minister announced a new scheme for strengthening public health infrastructure and human resources with outlay of Rs. 23,220 crore, to be spent in current fiscal. The new scheme will focus on short term emergency preparedness with special emphasis on children and pediatrics care/pediatrics beds. Under the scheme, funds will be available for short-term human resources (HR) augmentation through medical students, increasing availability of ICU beds, oxygen supply, ensuring availability of equipment and medicines, access to tele-consultation, strengthening ambulance services, and enhancing testing capacity.
As COVID-19 and lockdowns adversely impacted small traders, vendors and those serviced by micro-financed institutions in small towns, the finance minister said the government will stand guarantee for giving loans to 25 lakh small borrowers through micro-finance institutions. The loan tenure will be for three years. The focus will be on new lendings.
In two major steps to give a boost to the tourism sector, Sitharaman announced a new loan guarantee scheme. It will cover 10,700 recognised regional level tourist guides who will be given loans up to Rs. 1 lakh with 100 per cent guarantee to kick-start their work, while the agents and tourist agencies will be loans up to Rs 10 lakhs.
Another scheme aimed at boosting the tourism sector provides for waiving off the visa fee for first five lakh foreign tourists. The scheme will begin once visa issuance is restarted. However, the benefit will be available only once per tourist. The facility will be applicable till March 31, 2022 or till five lakh visas are issued, whichever is earlier. Total financial implications of the scheme to the government will be Rs 100 crore.
The government also extended the Aatmanirbhar Bharat Rozgar Yojana launched on October 1, 2020 till the end of current fiscal year. It incentivises employers to create new employment, restoration of loss of employment through EPFO.
The government will also infuse Rs. 88,000 equity in export credit guarantee corporation (ECGC) which promotes exports by providing credit insurance services. Rs. 19,041 crore have been envisaged for broadband in each village through BharatNet PPP model. Out of 2,50,000 gram panchayats, 1,56,223 gram panchayats have been made service-ready by May 31, 2021. For the remaining villages, the funds have been earmarked.
Sitharaman also announced extension of tenure of PLI scheme for large scale electronics manufacturing.
The finance minister said the Centre will spend Rs. 97, 631 crore for reform-based result-linked power distribution scheme announced in the budget. This scheme is aimed at nudging the states towards power sector reforms.
Sitharaman said the government was formulating a new policy for appraisal and approval of PPP proposals. The policy will aim to ensure speedy clearance of projects to facilitate private sector’s efficiencies in financing construction and management of infrastructure.
