Recent trends of economic recovery are testimony to govt’s intervention: Fin Min sources

In trying times of a pandemic, when COVID-19 has spared ne by hitting hard on lives and livelihoods of people and ecomies around globe, Government of India has been taking all possible measures to mitigate COVID impact. Recent trends of ecomic recovery bear testimony of its timely intervention – said a top source in Ministry of Finance.

source was responding to report published in a certain section of media where an impression has been sought to be created that Government lacks consensus at highest levels while pushing fiscal stimulus and packs. source said that swift steps taken by Government and recent trends of ecomic recovery — increase in GST collection, PMI index, Exports etc. — mselves dispel myth of tight fists and any lack of consensus.

" Government has been aware of ramifications of COVID-19 pandemic and that is reason why Ministry of Finance (MoF) has been proactively and continuously taking measures to provide support to those who need it most in a holistic manner and those measures are yielding results”, said top government source.

“While reing report card of Government’s comprehensive measures against challenges of COVID-19, one must ackwledge swiftness with which Government formulated and implemented two major Stimulus Packs — Prhan Mantri Garib Kalyan Pack (PMGKP) on March 26 and Aatmnirbhar Bharat Pack (ANBP) on May 12 — a special ecomic and comprehensive pack of Rs 20 lakh crore – equivalent to 10 per cent of India’s GDP," said source.

Ar source in kw of matter and who has been privy to most of meeting of PMO on COVID impact mitigation exercise said that under two packs, Government has implemented several measures, which, inter-alia, include relief measures for households such as in-kind (food; cooking gas) and cash transfers to senior citizens, widows, disabled, women Jan Dhan Account holders, farmers; insurance cover for workers in healthcare sector; and w increase for MGNREGA workers and support for building and construction workers, collateral-free loans to self-help groups, reduction in EPF contributions, employment provision for migrant workers (Prhan Mantri Garib Kalyan Rojgar Abhiyaan). implementation of pack is reviewed and monitored regularly at highest level”, said source.

Major among m are:

• Prhan Mantri Garib Kalyan Pack (PMGKP) around 42 crore poor people have received financial assistance of Rs. 68,921 crore as on 1st October 2020.
• Rs 30,952 crore credited through DBT to 20.65crore (100%) women Jan Dhan account holders.
• Almost 8.94 crore farmers under PM Kisan were paid with two instalments of Rs 17,891 crore each.
• Free food grains to about 81 crore beneficiaries @5 kg per beneficiary for 8 months has been arranged with a total allocation of 320 lakh metric tonne grains. This covers more than 60 % of India’s population.
• Free pulses/chana to about 20 crore household @1 kg per month for 8 months is being provided for which approximately 16 lakh metric tonne grain is allocated.
• Rs 4.29 crore PM Ujjwala Yojana cylinders delivered to beneficiaries for April 2020, 3.78 crore for May, 3.05 crore for June, 1.05 crore for July, 0.89 crore for August, and 0.72 crore for September.
• Insurance scheme for health workers in Government hospitals and Health care centres operationalised w.e.f. March 30 and Rs 130.5 crore paid towards insurance premium till date.
• Rs 15,000 crore fund for health sector is being implemented in 3 phases – In first phase of Rs 9904 crore (Jan 2020 to June 30 2020), NHM allocated Rs 3379 crore, Procurement Rs 4724 crore, DHR/ICMR Rs 1163 crore, NCDC Rs 18 crore and Railways Rs 620 crore. second phase (July 1, 2020, to March 31, 2021) to be of Rs 5048 crore and third phase (April 2021 to March 2024) of Rs 48 crore.
• As on September 30, about 30 crore man-days employment has been provided to migrant workers and more than Rs 27,000 crore spent so far under Garib Kalyan Rojgar Abhiyaan. More than 1.14 lakh water conservation structures, about 3.65 lakh rural houses and nearly 10,500 community sanitary complexes have been created under Abhiyaan. 1,662 Gram Panchayat have been provided internet connectivity. A total of 17,508 works related to solid and liquid waste manment undertaken and 54,455 candidates have been provided skill training through Krishi Vigyan Kendras (KVKs). 6727 works have been taken up through District Mineral Funds.
• Under MGNERGS an ditional provision of Rs.40,000 crore has been me for FY 2020-21 raising total allocation to Rs 1,01,500 crore in MGNREGS.
• 1.82 crore building and construction workers received financial support amounting to Rs 4,987.18 crore.
• 40.59 lakh members of EPFO took online withdrawal benefit of n-refundable vance from EPFO account amounting to Rs 10,615 crore.

All se money and assistance have gone directly through Direct Benefit Transfer into bank accounts and in hands of deserving people, without any middlemen and any delay.

RE | Eight Core Industries Output Contracts 8.5 Pc In Aug

RE | India Reports Current Account Surplus For Second Straight Qtr At 3.9 Pc Of GDP In April-June

Relief measures for MSMEs

re were also relief measures for MSMEs and entrepreneurs such as collateral-free lending programme with 100 per cent credit guarantee, subordinate debt for stressed MSMEs with partial guarantee, partial credit guarantee scheme for public sector banks on borrowings of n-bank financial companies, housing finance companies (HFCs), and micro finance institutions, Fund of Funds for equity infusion in MSMEs, ditional support to farmers via concessional credit, as well as a credit facility for street vendors (PM SEVA Nidhi), amongst ors”. Major among m  are

• Rs 3 lakh crore Collateral-free Automatic Loans for Businesses, including MSMEs is being provided of which Rs. 1,25,412 crore is  alrey disbursed to more than 25.63 lakh borrowers in just four months;
• Rs 45,000 crore sanctioned in Partial Credit Guarantee Scheme 2.0 for NBFCs;
• Rs 30,000 crore in Special Liquidity Scheme for NBFCs/ HFCs/ MFIs has been sanctioned;
• Rs. 30,000 crore ditional Emergency Working Capital Funding is being provided to farmers through NABARD;
• Rs 1 lakh crore Agri Infrastructure Fund for farm-gate infrastructure for farmers - Farmers will get loan for building stor for storing food grains, to buy machines for making food grains rey to eat and buy vehicles for transporting food.
• Rs 2 lakh crore Concessional credit boost to 2.5 crore farmers through Kisan Credit Cards – Farmers (also fishermen and animal husbandry farmers) can spend more w on ir credit cards - In Phase I, 58.12 lakh KCC cards with KCC limit of Rs. 46,330 crore h been sanctioned, Under Phase II, as on 25th September 2020, a total number of 83.03 lakh KCC with KCC limit of Rs. 78,999.80 crore sanctioned.
• Rs 20,000 crore for fishermen through Prhan Mantri Matsya Sampa Yojana (PMMSY) – Support to existing fishermen to expand and new ones to set up a business.
• Rs 5000 crore Special Credit Facility for Street Vendors – will support businesses by roside by giving m easy loans.
• Rs 50,000 crore liquidity has been injected into ecomy through TDS/TCS rate reduction.
• Ministry of Finance  helped liquidity in market by urgently releasing refunds under special drive worth Rs. 1,18,324 crore in Direct Taxes and of worth Rs. 66,861 crore in Indirect Taxes – an increase of more than 6%  as compared to last year.

Support to States

Also, Centre has continued to lend unflinching support to State Governments towards faster ecomic revival. Despite pandemic and consequent fall in gross tax revenue, Rs 2,17,976 crore has been transferred to State Governments as devolution of share of taxes by Centre in first five months of FY 2020-21 which is only Rs 37,629 crore lower than previous year.

Centre has alrey raised borrowing limit of states from 3 per cent to 5 per cent of GDP to cope with pandemic induced requirement of higher expenditure. As per recently anunced, borrowing programme of Government of India Rs 4,34,000 crore for second half of FY 2020-21 is expected to be completed by January 2021 to help generate sufficient to man borrowing programme of State Governments smoothly.

RE | Railways Surpasses Freight Revenue Of Sep 2019 By 13.5 Pc, Says 'remarkable Turnaround'

RE | Govt To Borrow Rs 4.34 Lakh Cr In Second Half Of 2020-21

Recovery is underway

implementation of ABNP and unlocking of ecomy have ensured ecomic recovery in India gaining momentum. Rising tractor sales and healthy monsoons suggest that Kharif crop is expected to be above rmal, implying robust rural demand in near future as well, also augurs well for upcoming Rabi sowing.

Registration of two-wheelers/three-wheelers/passenger vehicles along with tractor sales are reaching/surpassing previous year levels in August. Recovery in rail freight revenue earnings going past previous levels in August and showing strong 13.5 per cent growth in first 20 days of September, first time since March while port cargo traffic continues its urd trajectory, aviation activity also catching up, a furr uptick in steel sector as it inches up to previous year levels.

Power consumption in September up to 29th of month has w crossed previous year levels having grown at an encouraging rate of 4.2 per cent, YoY. Value and number of E-way bills generated are crossing previous year levels.

GST collections for first time this year has gone past previous year level by 4.3 per cent in September. Electronic payment transactions through banking channel (UPI) has hit an all-time in August moving ahe of February level. At an eight-year high of 56.8 in September 2020, India’s manufacturing purchasing manrs’ index in expansionary territory for two months, which augurs well for ecomic expansion in coming months.

top source said that phased relaxation of lockdown, supported by enabling policies of Government, has resulted in a much higher level of ecomic and business activities in months of July, August and September. This is evident in growth of high-frequency indicators like PMI Manufacturing, index of eight core industries,  GST collections E-way bills, Kharif sowing, power consumption, railway freight, cargo traffic and passenger vehicle sales.

“ above prompt action in policy and its implementation clearly dispels myth that Government lacks consensus or will to serve its people in a holistic manner. data proves exactly contrary," said source.

(PTI Photo for representation)