Covid-19: Govt announces Rs 6.29 lakh crore relief measures for various sectors

In a major relief for Covid-19 affected sectors, Union Finance Nirmala Sitharaman has announced financial support for various sectors like tourism, Micro, Small and Medium Enterprises (MSMEs) and exports. According to the government, the new relief measures will cost Rs 6,28,993 crore to the government exchequer. Check the details here.

New Delhi:In a bid to revive the economy battered by a server second wave of Covid-19, Union Finance Nirmala Sitharaman has announced financial relief measures worth Rs 6.29 lakh crore for the revival of sectors like tourism, agriculture, MSMEs, power distribution, and exports.

Announcing a series of measures on Monday in the national capital, Sitharaman said the government has sanctioned Rs 23,220 crore to set up paediatric beds and facilities in hospitals across the country. This additional funding was sanctioned as some experts have warned that a third COVID wave may affect children more than adults.

The minister also announced a credit guarantee scheme worth Rs 1.1 lakh crore will be launched for Covid-19 affected sectors. Out of this, Rs 50,000 crore is allocated for developing medical infrastructure in underserved areas while the other sectors will get Rs 60,000 crore financial assistance.

Other important decisions announced by the Govt -

In addition to Rs 1.1 lakh crore financial support, Rs 1.5 lakh crore credit guarantee scheme was announced under the ECLGS. Out of the earlier Emergency Credit Line Guarantee Scheme (ECLGS) of Rs 3 lakh crore, Rs 2.69 lakh crore already utilised. This scheme is targeted towards the Micro, Small and Medium Enterprises (MSMEs) sector.

A new scheme for the tourism sector was announced. Under this scheme, financial support to more than 11,000 tourist guides will be given with 100% government guarantee. Loans up to Rs 10 lakh for agency, and up to Rs 1 lakh for tourist guides will be given under this initiative. According to govt estimates, this will help more than 10,700 registered tourist guides. The scheme will be administered by the ministry of tourism through National Credit Guarantee Trustee Company Ltd (NCGTC).

In another relief measure for tourism, free tourist visas to 5 lakh tourists will be given to encourage travel to India. The scheme will be valid till March 2022 or till 5 lakh visas are exhausted. This measure has a total financial implication of Rs 100 crore. According to government estimates, nearly 1 crore tourists visited India in 2019, spending over USD 30 billion (about Rs 2.2 lakh crore) and average tourist spending stood at Rs 2,400 per day.

The government extended the Atmanirbhar Bharat Rozgar Yojana, which was announced earlier under Atmanirbhar Bharat. The government approved an outlay of Rs 22,810 crore for 58.5 lakh beneficiaries. In the scheme, the Government gives subsidies of 12+12% EPFO contribution (if less than 1000 workers), and only 12% employee contribution in case more than 1000 workers. The extended scheme will be in force till March 2022.

Financial details of relief measures announced by Nirmala Sitharaman. Source: Union Ministry of Finance

Sitharaman recalled that the government has spent Rs 1,33,972 crore on PM Garib Kalyan Anna Yojana so far. Earlier this month, Prime Minister Narendra Modi extended the scheme till November 2021. The extension has a financial implication of Rs 93,869 crore. Total implication of the scheme in two financial years will be Rs 2,27,481 crore.

Government will revive North Eastern Regional Agricultural Marketing Corporation Ltd. (NERAMAC) with an outlay of Rs 77.45 crore. It has 75 farmer produce organisations and 13 Geographical indication (GI) certified crops which are specific to the North East.

Sitharaman said Rs 33,000 crore will be allocated for supporting exports through National Export Insurance Account (NEIA). So far, NEIA trust supported 211 projects worth Rs 52,860 crores. In future, it will support Rs 33,000 crore worth projects over the next five years.

Government will infuse Rs 88,000 crore as equity in Export Credit Guarantee Corporation (ECGS) over five years to boost export insurance cover. ECGS supports around 30% of India's merchandise exports.

In a major boost for Digital India initiative, Rs 19,041 allocation was made to BharatNet in addition to the earlier Rs 42,068 crore allocated in 2017. This takes the total amount to Rs 61,109 crore. The amount will be spent to expand broadband to over 2.5 lakh gram panchayats. Till May 31, 2021, over 1.56 lakh gram panchayats have been made service ready by May 31, 2021.

The tenure of the Production-Linked Incentive (PLI) scheme for the electronics manufacturing sector has been extended by one year till 2025-26. The PLI Scheme was announced last year under the Atmanirbhar Bharat initiative to give a boost for the domestic manufacturing sector. Presenting the Union Budget 2021-22, Finance Minister Nirmala Sitharaman expanded the PLI Scheme to 13 sectors with a commitment of Rs 1.97 lakh crore.

Elaborating the details of Rs 3.03 lakh crore reform based result linked power distribution scheme, Sitharman said the Centre will spend Rs 97,631 crore under this initiative in 2021-22 to assist power distribution companies (DISCOMS) for infrastructure creation, up-gradation of system, capacity building and process improvement.

The minister further said that ongoing works of Integrated Power Development Scheme (IPDS), Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) and Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA) will be merged under the new power distribution scheme.