Nirmala Sitharaman Announces Rs 6.28,993 Crore Relief Plan to Support Indian Economy, Industry Welcomes Move
Nirmala Sitharam, the union’s finance minister, announced a series of measures to help sectors affected by the second wave of the COVID-19 pandemic. A relief plan of Rs 6.28,993 crore has been set aside to support the Indian economy and help recover from the devastating effects of the pandemic. Prime Minister Narendra Modi said the announced measures will help small entrepreneurs and the self-employed to maintain and develop their business activities further.
“The measures will help stimulate economic activities, boost production and exports and create jobs. The results-linked power distribution program and streamlined processes for PPP projects and asset monetization demonstrate our government’s continued commitment to reforms, ”he said. The finance minister said the reforms announced were for the 21st century New India.
Measures announced by Nirmala Sitharaman
The main reforms announced to help industries fight the COVID-19 pandemic are as follows:
- A loan guarantee program of Rs 1.1 lakh crore has been announced for sectors affected by COVID-19.
- An additional crore of Rs 1.5 lakh for the emergency line of credit guarantee program will also be offered.
- The credit guarantee program will facilitate loans to 25 lakh people through microfinance institutions (MFIs).
- Financial support is offered to over 11,000 registered tourists, guides, travel and tourism actors, and a free one-month tourist visa will be provided to the first 5 lakh tourists.
- AatmaNirbhar Bharat Rozgar Yojana will be extended until March 31, 2022.
- Rs 23,220 crore was announced for public health with a focus on children and pediatric care or pediatric beds.
- Rs 19,041 crore was announced for broadband in each village via BharatNet’s PPP model.
- The PLI regime’s mandate for large-scale electronics manufacturing has been extended from 2025 to 2026.
- Rs 3.03 lakh crore for a results based and reform based energy distribution system.
- New streamlined process for PPP projects and asset monetization.
A snapshot of the financial details of the advertised programs is as follows:
Economic relief from COVID-19 pandemic: Rs 3.76,244 Crore.
New public health plan: Rs 15,000 Crore.
Impulse for Growth and Jobs: Rs 2,37,749 Crore.
Industry reactions to announcements made by Nirmala Sitharaman
The industry greatly appreciated the reforms announced by the Minister of Finance. Shachindra Nath, Executive Chairman and Managing Director of U GRO Capital, appreciated the measure announced on the emergency credit lines guarantee program. “The Minister of Finance today announced essential relief measures for several affected sectors. Considering the fact that nearly 90% of the expenditure of the Emergency Credit Line Guarantee Program (ECLGS) was actually used to support the affected MSME sector, an additional Rs 1.5 lakh crore will greatly catalyze the recovery. as well as the growth processes of MSMEs. The announcement came at an important time, with World MSME Day being celebrated the day before. In addition, the credit guarantee system for 25 Lakh people through micro-finance institutions and the financial measures announced for the tourism sector are highly appreciated. With the economy cautiously opening up in stages, the measures announced will certainly prove viable for MSMEs and individuals in their efforts to reshuffle broken cash flows, ”he said.
A Gururaj, Managing Director of Optiemus Electronics Limited, said the government’s decision to extend the duration of the PLI program is welcome. “We are grateful to the government for taking into account industry demand in view of some of the problems encountered as a result of the pandemic,” he commented. Rupinder Malik, Partner, J Sagar Associates said the finance minister’s announcement on the extension of Aatmanirbhar Bharat Rozgar Yojana was necessary to save jobs. “In my opinion, expanding the program is useful because it can prevent job losses in low-income, labor-intensive industries. Private companies will be encouraged to keep the number of employees on their lists to continue to receive a Contingency Fund Contribution Grant, ”commented Malik.