Finance Minister Nirmala Sitharaman announced new stimulus measures to rescue the economy from a historic contraction. “Various indicators show that the recovery is clearly happening in the economy … The strong recovery is based on the relentless reforms that the government has carried out in a systematic way,” the finance minister said at a press conference. His press conference comes at a time when economists have called for more momentum to help revive an economy hit by the world’s biggest lockdown to slow the spread of COVID-19. The latest government monetary and fiscal support of Rs 21 lakh crore, called the Atmanirbhar Bharat package, was introduced in May this year. Many economists say the Atmanirbhar package has failed to soften the blow of the strict coronavirus lockdown, as it focused on providing liquidity and unsecured credit for small businesses, but with little actual spending.
These are the highlights from Finance Minister Nirmala Sitharaman’s press conference:
- We are going to announce some new measures
- First, I would like to give you a picture of the economic situation and the impact on Atmanirbhar Bharat recently made announcements
- Active COVID-19 cases have decreased
- In the last 10-15 days, there have been many measures and indicators that show that the recovery is clearly happening
- Strong recovery builds on relentless reforms systematically introduced by the government
- GST collections were Rs 1.05 lakh crore in October, an increase of 10% year-on-year
- FDI inflows stood at 35.37 billion dollars in April-August, 13% more
- The growth of bank credit has improved compared to last year, with an increase of 5.1% year-on-year (as of October 23)
- Markets are at record levels, with market caps at record levels (see the latest updates here)
- RBI’s foreign exchange reserves have reached $ 560 billion
- RBI predicts a strong probability that the economy will grow again in the third quarter
- Moody’s today revised India’s GDP projection to -8.9% (2020-21) from -9.6%
- PROGRESS ON ATMANIRBHAR BHARAT 1.0 MEASURES:
- Within the framework of the “One nation, one ration card” program, interstate portability was achieved in 28 states / territories of the Union, covering 68.6 million beneficiaries
- Intrastate portability was also achieved, with transactions of Rs 1.5 million per month
- Under PM Steet Vendor’s Atmanirbhar Nidhi (PM Svanidhi) scheme, 26.32 lakh of loan applications were received, 13.78 lakh of loans (amounting to Rs 1373.33 crore) sanctioned in 30 states and six UT
- Kisan Credit Card: Rs 2.5 Crore Credit Increase Achieved for Farmers
- 1.83 lakh of applications received
- Under ECLG 1.0, Rs 2.05 lakh crore sanctioned to 61 lakh borrowers, Rs 1.52 lakh crore disbursed
- Under the partial credit guarantee scheme, PSU banks approved the purchase of portfolios worth Rs 26,889 crore
- Under a special liquidity scheme for non-bank finance companies / home finance companies, 7,227 crore was disbursed
- Rs 1,18,273 crore loans sanctioned to 17 states / TU for liquidity injection for power distribution companies, Rs 31,136 crore already disbursed to 11 states / TU
- PROGRESS ON ATMANIRBHAR BHARAT 2.0 MEASURES (ANNOUNCED ON OCTOBER 12):
- Festival preview launched for government staff, SBI Utsav cards are being disbursed
- Travel concession plans (LTC) launched
- Rs 25,000 crore provided as additional capital expenditure (capex) to the ministries of roads and defense
- Rs 3,621 crore sanctioned to 11 states as interest free loans for capital expenditure
- PM Rozgar Protsahan Yojana (PMRPY) implemented until March 31, to encourage formalization, job creation
- Total benefit of Rs 8,300 crore awarded to 1,52,899 companies covering 1,21,69,960 beneficiaries
- TODAY’S ANNOUNCEMENTS (ATMANIRBHAR BHARAT 3.0):
- 12 areas to cover
- Announces Atmanirbhar Bharat Rozgar Yojana, aimed at incentivizing the creation of job opportunities during the recovery phase of COVID-19
- Beneficiaries of this new scheme will include: new hires entering employment in EPFO registered establishments with monthly salaries below Rs 15,000 and EPF members earning a monthly salary of less than Rs 15,000 who left employment during March-September and that they worked from October 1
- The central government will give a subsidy to the new jobs.
- Employee and employer contribution of 12% each paid by the government
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