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Economic Stimulus package

Topics Covered: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Economic Stimulus package

What to study?

For Prelims and Mains: Measures announced and their significance.

 Context: Union finance minister Nirmala Sitharaman has unveiled the second tranche of measures of the government’s “atmanirbhar (self-reliant) campaign”.

Background:

With a view to revive the economy shuttered by the coronavirus lockdown, PM Narendra Modi had announced a Rs 20 lakh crore special economic package.

In its first instalment, FM had announced Rs 3 lakh crore collateral-free automatic loans for businesses, including MSMEs, as well as Rs 30,000 crore liquidity facility for NBFCs, among other measures.

Key measures announced:

  1. Free food grains will be supplied to all Migrant labourers for 2 months i.e. May and June, 2020.
  2. Technology system to be used to enable Migrants to access PDS (Ration) from any Fair Price Shops in India so as to achieve 100% National portability by March, 2021 under One Nation one Ration Card scheme.
  3. Central Government will launch a scheme for migrant workers and urban poor to provide ease of living at affordable rent.
  4. Government of India will provide Interest subvention of 2% for prompt payees for a period of 12 months to MUDRA Shishu loanees, who have loans below Rs 50,000.
  5. A special scheme will be launched within a month to facilitate easy access to credit to Street vendors. 50 lakh street vendors will be benefitted under this scheme and credit of Rs. 5,000 crore would flow to them.
  6. Rs 70,000 crore boost is given to housing sector and middle-income group (MIG) through extension of Credit Linked Subsidy Scheme for MIG under PMAY(Urban) up to March 2021.
  7. 6,000 crore of funds under Compensatory Afforestation Management & Planning Authority (CAMPA)will be used for Afforestation and Plantation works, including in urban areas. This will create job opportunities.
  8. NABARD will extend additional re-finance support of Rs 30,000 crore for meeting crop loan requirement of Rural Cooperative Banks and RRBs. This refinance will be front-loaded and available on tap.
  9. A special drive to be conducted to provide concessional credit to PM-KISAN beneficiaries through Kisan Credit Cards. Fisherman and Animal Husbandry Farmers will also be included. This will inject additional liquidity of Rs 2 lakh crore in the farm sector.

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InstaThink:

Prelims Link:

  1. What is CLSS?
  2. Loads under MUDRA Yojana.
  3. NFSA eligibility.
  4. CAMPA- features, funds and utilisation.
  5. NABARD- objectives and functions.
  6. PM- KISAN- features, eligibility and benefits.

Sources: pib.