New Delhi: At a time when the country's economy is in deep trouble on account of continuous deceleration in GDP growth rate and nearly sixty days of nationwide lockdown, the central government saw an opportunity in the crisis.
The Ministry of Finance has announced Rs 20 lakh crore financial package and policy reforms to kick start the economy in the post lockdown phase and, subsequently, to achieve Atmanirbhar Bharat (Self-Reliant India).
In an exclusive interview to Etv Bharat, Union Minister of State for Finance and Corporate Affairs Anurag Thakur spoke on migrant issues, non-performing assets of banks and defended the financial package from the criticism that it failed to address much needed demand side problems of the economy.
Edited Excerpts:
Looking at the migrant crisis we are facing now, has the central government failed to create confidence for workers to stay where they are? What's your view on giving direct cash transfers to migrant labourers?
It is the primary responsibility of the host state and the home state to take care of the guest workers. Both must coordinate and provide support through these uncertain times. The role of Central Government is to facilitate which has been ensured with availability of trains to transport them and also provided free food and water.
We ran 3,840 Shramik Special trains and more than 52 lakh passengers have reached their destination. Railways had provided 85 lakh meals and 1.25 crore bottled water to passengers on Shramik specials so far.
We have earmarked Rs 3,500 crore for 5kg/per person of food grains and 1 kg pulses per family to 8 crore guest workers. The PM Garib Kalyan Package was aimed at vulnerable sections of society.
Does the government leave out salaried class, middle class from giving any direct tax benefits due to fiscal constraints?
MSME sector is the backbone of the Indian economy. It provides employment to 120 million people and contributes around 45% to the overall exports from India.
After due consultations in the fund of Rs 3 lakh crore for MSMEs, the Central government has provided 100% credit guarantee and collateral free cover to banks and NBFCs.
In order to provide more funds at the disposal of the middle class, the rates of TDS have been reduced by 25 per cent. This ensures induction of INR 50,000 crores liquidity into the market and this reduction is available till 31 March 2021.
On the Rs 20 lakh crore fiscal stimulus, former Finance Minister P Chidambaram has said if there is no extra-budgetary spending then there is no fiscal stimulus. Your comment on this.
We have been fiscally prudent and still ensured that all sections of the country are covered by this package.
Many economists had pointed out that the financial package didn't address the demand-side problem which the economy is facing right now. Your comment on this.
Demand and supply do not work in silos and measures on the supply side affect the demand side as well.
Consumer demand is improved by giving financial and other income supports to the people. Around 41 crore people have received financial assistance of Rs 52,608 crore under Pradhan Mantri Garib Kalyan Yojana (PMGKY) already.
Over Rs.18,000 crore have been given which has reached 9 crore farmers.
Over Rs 20,000 crore was credited to more than 20 crore women Jan Dhan account holders as first instalment.
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Further, under National Social Assistance Programme (NSAP) Rs 2,807 crore has been disbursed to about 2.82 crore old age persons, widows and physically-challenged persons in two instalments.
Over 2.20 crore building and construction workers got Rs 3,950 crores.
We will also pay the contribution of both the employee and employer’s 12%+12% for the next six months also extending further Rs. 2,500 crores benefit to people.
Our historic reforms in agriculture will endure towards increasing farmers income throughout India.
All these measures have been a boost to stimulate demand.
While going extra mile for ensuring credit availability in the system, does the government consider the bank's health as bad loans and NPAs pile up?
The Government is well aware of the banks’ health and our measures have been announced after due consultations.
For the Rs 3 Lakh crore fund that was announced as an emergency credit guarantee line for enterprises, the Government has given 100 per cent credit guarantee and collateral free, for interest and principal.
Are there any plans in the future to give specific revival package for the industries which were deeply impacted by the COVID crisis like travel, tourism, exports, etc?
I want to emphasize that transport, tourism, travel, exports also fall under the definition of businesses including MSMEs. We have allocated INR 3 lakh crores package to all businesses including MSMEs. Our announcements have taken a pause, however reforms are a continuous process and we will continue taking measures as and when required.
Unemployment is rising rapidly after the spread of the pandemic. Is the government planning for any special scheme to address the issue, especially in urban areas?
The 3 lakh crore package for MSMEs has been undertaken with a view to hand hold them to pay wages, purchase raw materials and get on the road to recovery. Even for rural population, the historic Rs 1 lakh crore allocation to MNREGA will ensure 300 crore person days are generated and they have work even once they return to their villages. Further, new avenues have been opened up and will create new types of jobs. Modi Government will do everything possible for Indians & India Inc.
