On June 28, Finance Minister Nirmala Sitharaman announced a relief package worth Rs 6,28,993 crore to support India’s dwindling economy.
The stimulus package is aimed at boosting the economic recovery amid the battle with the pandemic. Commenting on it Prime Minister Narendra Modi said the package will boost production and improve employment.
“The measures will help to stimulate economic activities, boost production & exports and generate employment.” He also added that it will improve public health facilities in the under-served areas.
“Multiple initiatives have been announced which reduce farmers’ costs, increase their incomes and support greater resilience and sustainability of agricultural activities,” he said.
In response to the relief package announced by the Government, Senior Congress leader Chidambaram took to Twitter to say that ‘the answer to this crisis is to put money in the hands of the people, especially the poor and lower-middle classes.’
“Some elementary truths: Credit guarantee is not credit. Credit is more debt. No banker will lend to a debt-ridden business. Debt-burdened or cash-starved businesses do not want more credit, they need non-credit capital.”
“More supply does not mean more demand (consumption). On the contrary, more demand will trigger more supply,” he continued.
Focussing on the possible third wave of the Covid-19 pandemic, the package is aimed at bringing relief to sectors hit by it. Rs 50,000 crore has been allocated to the healthcare sector, out of the Rs 1.1 lakh crore of the loan guarantee scheme.
The economically hit micro, small and medium enterprises (MSMEs) will get relief from the Emergency Credit Line Guarantee Scheme (ECLGS). The Union Government of India launched the scheme to provide financial support of Rs 1.5 lakh crore.
Talking about the Rs 50,000 crore allotted to the healthcare sector, Sitharaman said that, “we have allocated more for Public Health. A sum of Rs. 15,000 crores have been allocated for Emergency Health Systems Project (2020-2021) that will lead to 25 folds increase in COVID dedicated hospitals.”
She announced 7,929 covid health centres, 9,954 covid care centres and 7.5 times increase in oxygen supported beds after the infrastructure collapse during the second wave. “New scheme focused on short term emergency preparedness with special emphasis on children and paediatric care. Rs 23,220 crores have been earmarked for one year.”
17 initiatives were announced under the Rs 6,28,993 crore package, including additional corpus to National Export Insurance Account (NEIA), Financial support to over 11,000 tourism beneficiaries, the extension of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY).
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