The Union Finance Minister addressing the nation on 28th June 2021, announced a slew of measures to provide relief to diverse sectors affected by the 2nd wave of COVID-19 pandemic. The measures announced also aim to prepare the health systems for emergency response and provide impetus for growth and employment.
A total of 17 measures amounting to INR 6,28,993/- crores were announced.
3 broad categories of measures announced are:
- Economic Relief from Pandemic
- Strengthening Public Health
- Impetus for Growth & Employment
A summary of Measures announced by the FM are as under:
- ECONOMIC RELIEF FROM PANDEMIC
- LOAN GUARANTEE SCHEME FOR COVID AFFECTED SECTORS
| Particulars | Measures of the Govt. | Impact |
| Loan guarantee scheme for covid affected sectors | · Loan guarantee scheme for health (INR 50,000 crores) & other sectors (INR 60,000 crores)
· Aimed at scaling medical infrastructure targeting underserved areas. · Measures include guarantee cover for expansion and new projects, interest rate capping, etc.
|
INR 110,000 crores
|
EMERGENCY CREDIT LINE GUARANTEE SCHEME
| Emergency credit guarantee scheme (ECLGS) for various sectors | · Launched as a part of Atma Nirbhar Bharat Package in May, 2020
oECLGS 1.0 , 2.0 and 3.0 have already resulted in credit disbursal oContact intensive sector would continue to be covered · Limit of admissible guarantee and loan amount proposed to be increased above existing level of 20% of outstanding on each loan · Sector wise details will be finalized as per evolving needs · Overall cap of admissible guarantee proposed to be raised |
INR 1.5 lakh crores |
CREDIT GUARANTEE SCHEME THROUGH MFIs
| Credit Guarantee Scheme to Facilitate Loans to 25 Lakh Persons Through Micro Finance Institutions (MFIs) | · Guarantee provided to Scheduled Commercial Banks for loans to new or existing NBFC-MFIs or MFIs
· Measures include: oInterest Rate capping at MCLR plus 2% oMaximum loan tenure of 3 years · Focus on new lending, not repayment of old loans
· All borrowers (including defaulters upto 89 days) eligible
· Guarantee upto 75% of default amount for upto 3 years through National Credit Guarantee Trustee Company (NCGTC)
|
INR 7,500 crores |
- FINANCIAL SUPPORT FOR REVIVAL OF TOURISM
| Financial support to Registered Tourist Guides/Travel and Tourism Stakeholders | · New Loan Guarantee Scheme for people in tourism sector to discharge liabilities and re-start businesses
· Scheme to cover recognized tourist guides and recognized Travel & Tourism Stakeholder.
· Scheme to be administered by the Ministry of Tourism through NCGTC |
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| Free Tourist Visa |
· Once Visa issuance is restarted, the first 5 lakh Tourists Visas will be issued free of charge.
· The scheme will be applicable till 31st March, 2022 or till 5,00,000 visas are issued, whichever is earlier |
INR 100 crores |
- REFORMS FOR CREATION OF NEW EMPLOYMENT
| Extension of Atma Nirbhar Bharat Rozgar Yojana | · Launched on 1st Oct, 2020 to incentivize employers for creation of new employment, restoration of loss of employment through EPFO
· Subsidy provided for two years from registration for new employees drawing monthly wages less than Rs. 15000
· Scheme extended from 30.06.2021 to 31.03.2022 |
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- ADDITIONAL ALLOCATION TO EXISTING RELIEFs
| Additional Subsidy for DAP and P & K fertilizers | · Existing NBS Subsidy has been increased:
oAdditional subsidy has been provided for DAP
oAdditional subsidy has been provided for NPK based complex fertilizer |
INR 14,775 crores |
| Extension of Pradhan Mantri Gareeb Kalyan Anna Yojana (PMGKAY) | · PMGKAY was launched on 26th March 2020 to ameliorate the hardships faced by the poor due to economic disruption caused by COVID 19 Pandemic
· In the wake of the second wave of COVID-19, the scheme was relaunched in May 2021 to ensure food security of poor/vulnerable · 5 kg of food grains will be provided free of cost to NFSA beneficiaries from May to November 2021 |
INR 93,869 crores |
- STRENGTHENING PUBLIC HEALTH
- HEALTH REFORMS AND INITIATIVES
| Public Health with emphasis on children and paediatric care/paediatric beds | · New scheme focused on short term emergency preparedness with special emphasis on children and paediatric care/paediatric beds.
· Increase availability of ICU beds, oxygen supply at central, district and sub-district level · Ensure adequate availability of equipment, medicines; access to tele-consultation; ambulance services · Enhance testing capacity and supportive diagnostics, strengthen capacity for surveillance and genome sequencing |
INR 15,000 crores |
- IMPETUS FOR GROWTH & EMPLOYMENT
- Reforms to provide impetus for growth & employment
| Release of Climate Resilient Special Traits Varieties | · Aims at fighting malnutrition and improving farmer’s income
· ICAR has developed bio-fortified crop varieties: oThat have high nutrients like protein, iron, zinc, vitamin-A oAre tolerant to disease, insects & pest, harsh climate, etc. |
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| Revival of North Eastern Regional Agricultural Marketing Corporation (NERAMAC) | · Aims to enhance agricultural, procurement, processing and marketing infrastructure in North East
· Proposes to set up North-Eastern Centre for Organic Cultivation, facilitating equity finance to entrepreneurs |
INR 77.45 crores |
|
Boost for Project Exports through National Export Insurance Account (NEIA) |
· Aims at providing covers to buyer’s credit, given by EXIM Bank, to less creditworthy borrowers and supporting project exporters
· Proposed to provide additional corpus to NEIA over 5 years to allow it to underwrite project exports |
INR 33,000 crores |
| Boost to Export Insurance Cover | · Aims at boosting export insurance cover in order to promote India’s merchandise export
· Proposed to infuse equity in Export Credit Guarantee Corporation |
INR 88,000 crores |
| Broadband to each Village through BharatNet PPP Model | · Objective is to promote Digital India
· Aims at expansion and upgradation of BharatNet to cover all Gram Panchayats and inhabited villages: oBroadband connectivity to all inhabited villages oImplementation of BharatNet in PPP model on viability gap funding basis |
INR 19,041 Crores |
| Extension of Tenure of PLI Scheme for Large Scale Electronics Manufacturing | · Aimed at providing incentive of 6% to 4% on incremental sales of goods under target segments that are manufactured in India, for a period of five years.
· Earlier applicable from 01.08.2020 (Base year 2019-2020). · Tenure of the scheme launched in 2020-21 is proposed to be extended by one year i.e., till 2025-26 · Participating companies will get option of choosing any five years for meeting their production targets under the scheme |
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| Reform Based Result Linked Power Distribution Scheme | · Revamped reforms-based, result-linked power distribution scheme of financial assistance to DISCOMS
· Aims at infrastructure creation, up-gradation of system, capacity building and process improvement · Participation contingent to pre-qualification criteria · Ongoing works of IPDS, DDUGJY and SAUBHAGYA will be merged |
INR 3.03 Lakh Crores |
| New Streamlined Process for PPP Projects and Asset Monetisation | · Aim is to ensure speedy clearance of projects to facilitate private sector’s efficiencies in financing construction and management of infrastructure
· New policy will be formulated for appraisal and approval of PPP proposals and monetization of core infrastructure assets, including through InvITs |
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FINANCIAL DETAILS OF COVID RELIEF PACKAGES AT A GLANCE
| S.No | Scheme | Period | Amount (INR In Crores) | Remarks |
| ECONOMIC RELIEF FROM PANDEMIC | ||||
| 1. | Loan Guarantee Scheme for COVID Affected Sectors | 2021-22 | 1,10,000 | |
| 2. | Emergency Credit Line Guarantee Scheme (ECLGS) | 2021-22 | 1,50,000 | Expansion |
| 3. | Credit Guarantee Scheme for Micro Finance Institutions | 2021-22 | 7,500 | |
| 4. | Scheme for tourist guides/stakeholders | 2021-22 | – | Covered under loan guarantee scheme |
| 5. | Free One Month Tourist Visa to 5 Lakh Tourists | 2021-22 | 100 | |
| 6. | Extension of Atma Nirbhar Bharat Rozgar Yojana | 2021-22 | – | |
| 7. | Additional Subsidy for DAP & P&K fertilizers | 2021-22 | 14,775 | |
| 8. | Free food grains under PMGKY from May to November, 2021 | 2021-22 | 93,869 | |
| STRENGTHENING PUBLIC HEALTH | ||||
| 1. | New Scheme for Public Health | 2021-22 | 15,000 | Scheme outlay Rs 23,220 Cr; Central Share Rs 15,000 Cr |
| IMPETUS FOR GROWTH & EMPLOYMENT | ||||
| 1. | Release of climate resilient special traits varieties | 2021-22 | – | |
| 2. | Revival of North Eastern Regional Agricultural Marketing Corporation (NERAMAC) | 2021-22 | 77 | |
| 3. | Boost for Project Exports through NEIA | 2021-22 to 2025-26 | 33,000 | |
| 4. | Boost to Export Insurance Cover | 2021-22 to 2025-26 | 88,000 | |
| 5. | Broadband to each village through BharatNet PPP Model | 2021-22 to 2022-23 | 19,041 | |
| 6. | Extension of Tenure of PLI Scheme for Large Scale Electronic Manufacturing | Time extension | ||
| 7. | Reform Based Result Linked Power Distribution Scheme (Budget Announcement) | 2021-22 to 2025-26 | 97,631 | Scheme outlay Rs 3,03,058 Cr; Central Share Rs 97,631 Cr |
| TOTAL | 6,28,993 | |||
For details, please refer the link below to Press release of Ministry of Finance dated 28th June 2021 & Presentation on relief packages
https://pib.gov.in/PressReleasePage.aspx?PRID=1730963
https://static.pib.gov.in/WriteReadData/specificdocs/documents/2021/jun/doc202162821.pdf
PDF version is attached : https://www.dpncindia.com/blog/wp-content/uploads/2021/06/Relief-Packages-Announced-by-Finance-Minister-on-28th-June-2021.pdf
DISCLAIMER:
The information contained herein is in summary form based on Press release & Presentation on relief packages dated 28th June 2021. While the information is believed to be accurate to the best of our knowledge, we do not make any representations or warranties, express or implied, as to the accuracy or completeness of this information. Reader should conduct and rely upon their own examination and analysis and are advised to seek their own professional advice. This note is not an offer, invitation, advice or solicitation of any kind. We accept no responsibility for any errors it may contain, whether caused by negligence or otherwise or for any loss, howsoever caused or sustained, by the person who relies upon it.