Nirmala Sitharaman announces Rs 1.1 lakh crore loan guarantee scheme for Covid affected sectors
The Rs 1.1 lakh crore loan guarantee scheme for Covid affected sectors comprised of Rs 50,000 crore amount reserved for scaling up for healthcare infrastructure and Rs 60,000 crore for other sectors with interest rate capped at 8.25 per cent per annum. Decisions regarding the same will be taken at a later stage based on evolving needs, the FM said.
An additional Rs 1.5 lakh crore under the emergency credit guarantee scheme was also announced. The overall cap of the admissible guarantee will be raised from Rs 3 lakh crore to Rs 4.5 lakh crore, Sitharaman said. Launched as part of the Atma Nirbhar package in May 2020, the ECLGS 1, 2 and 3 have resulted in credit disbursal of Rs 2.69 lakh crore to 1.1 crore units by 12 PSUs, 25 private sector banks and 31 NBFCs.
As the third measure, a new credit guarantee scheme was announced to facilitate loans to 25 lakh persons through microfinance institutions (MFIs). A guarantee will be provided to SCBs for loans to new or existing NBFC-MFIs for lending up to Rs 1.25 lakh to approximately 25 lakh small borrowers, Sitharaman said.
The interest rate on loans from banks under this scheme would be capped at MLCR plus 2 per cent.
The maximum loan tenure would be three years and 80 per cent of assistance will be used by MFI for incremental lending. To be sure, focus would be on new lending and not repayment of old loans.
To revive tourism, financial support for more than 11,000 registered tourist guides and travel & tourism stakeholders was also announced. Under this scheme, working capital loans will be provided to people in the tourism sector to discharge liabilities and restart businesses impacted due to Covid-19.
Besides, the finance minister announced free tourist visas to 5 lakh tourists. Data showed 10.93 million foreign tourists visited India in 2019 and spent $30 billion on leisure and business.
The finance minister said the benefit will be available only once per tourist. The scheme will be applicable till March 31, 22 or till 5 lakh visas are issued, whichever is earlier.
She also announced an extension of the Atmanirbhar Bharat Rozgar Yojana date to March 31, 2022. Launched on October 1, 2020, the scheme incentivised employers for creating new employment and restoring loss of employment through EPFO. The last date for the registration was June 30, 2021. The approved outlay for the scheme was Rs 22,810 crore with 58.50 lakh in estimated beneficiaries.
Also, the FM unveiled an additional subsidy for DAP and NPK fertilisers. Sitharaman said an additional amount of Rs 14,775 crore will be provided in subsidies, which would include Rs 9,125 crore in addition subsidy for DAP and Rs 5,650 crore in subsidy for NPK based complex fertilisers. NPK stands for nitrogen, phosphorus and potassium.
Among other announcements, the government extended Pradhan Mantri Gareeb Kalyan Anna Yojna (PMGKAY) to November 2021 from May earlier. The estimated financial implications are Rs 93,869 crore, bringing the total cost of the scheme to Rs 2.28 lakh crore. The scheme was first launched between April and June 2020.
meanwhile, a total of Rs 23,200 crore has been earned marked for public health for the next one year. The new scheme focuses on short term emergency preparedness with special emphasis on children and paediatric care paediatric beds.
This is after Rs 15,000 crore emergency health systems project was launched in FY21 that led to 25 fold increase in Covid dedicated hospitals, the FM said.
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