guarantee schemes
Union Finance Minister Nirmala Sitharaman on Monday announced the much-awaited fiscal package to revive the economy ravaged by the second pandemic wave, keeping the fiscal outgo limited for the current year.
The Rs 6.28-trillion package included a new credit guarantee scheme for health, tourism and micro borrowers, besides expanding the Emergency Credit Line Guarantee Scheme (ECLGS) by half to Rs 4.5 trillion and extending the Aatmanirbhar Bharat Rozgar Yojana.
“Measures announced by the FM will enhance public health facilities, especially in under-served areas, boost private investment in medical infrastructure and augment critical human resources. Special focus is on strengthening healthcare facilities for our children,” Prime Minister Narendra Modi tweeted.
The new announcements include extending credit guarantees of Rs 2.6 trillion and schemes worth Rs 2.4 trillion, spread over the next two to four years.
Economists estimate the fiscal outgo for fresh announcements in the current financial year at around Rs 60,000 crore, excluding the credit guarantee schemes.
An additional allocation of Rs 2.32 trillion has been made to develop health facilities for children.
“There are eight such measures being announced as relief. Of those, four are absolutely new. One is specific to health infrastructure and others pertain to growth in general, exports and employees … We also want to revive tourism to survive the second Covid-19 wave,” Sitharaman said.
The government announced Rs 1.1-trillion loan guarantees for pandemic-affected sectors. Of that Rs 50,000 crore will be for scaling up medical infrastructure in non-metropolitan cities.
The scheme will provide loans up to Rs 100 crore for three years with interest capped at 7.95 per cent. Guarantee coverage on such loans extended would be 50 per cent for expanding existing facilities and 75 per cent for new projects.
“There are no quantitative targets for health infrastructure. It will be demand-based to cover underserved areas to be decided by the private health care providers and banks, and where the need is felt,” said Finance Secretary T V Somanathan.
The remaining Rs 60,000 crore under the scheme has been earmarked for credit guarantees for other sectors, including travel and tourism, with interest capped at 8.25 per cent.
In order to support the rural economy and demand, the government has announced another credit guarantee scheme to finance loans through microfinance institutions (MFIs). The government will provide guarantees to scheduled commercial banks for loans to new or existing MFIs on lending up to Rs 1.25 lakh to about 2.5 million small borrowers. The interest rate under the scheme will be capped at the marginal cost of funds based lending rate (MCLR) plus 2 per cent.
“They can borrow for any of the purposes they want to,” said Sitharaman.
No comments:
Post a Comment