COVID-19: To revive growth govt working on bailout package of Rs 75,000 crore
New Delhi, Apr 09: The government is likely to set up a corpus fund of about Rs 75,000 crore to revive industries that are particularly labour intensive small and medium units.
This is part of an economic stimulus package that is currently under consideration aimed at reviving growth amidst the coronavirus outbreak.
The corpus is yet to be finalised and would be party funded by a cess proposed to be levied on certain commodities such as fuel and partly from budgetary support.
Last month, the government announced a Rs 1.70 lakh crore relief package in the form of food grains and cash transfers for the poor and vulnerable section of the society to help them deal with the hardships caused by the lockdown.
Now, the government is working on a stimulus to be given to hard-hit sectors of the economy after the lockdown is lifted, sources said, adding, an announcement is expected in the next few days depending on the severity of the pandemic.
Besides, further relief measures are being worked upon to mitigate the hardships faced by citizens, especially the poor and vulnerable section of the society, sources added.
The finance ministry along with the empowered group constituted by the Prime Minister's office (PMO) is working tirelessly on this aspect, sources said.
Last week, the PMO constituted a seven-member empowered group headed by economic affairs secretary Atanu Chakraborty, who is monitoring the situation on a daily basis.
The empowered group is not only looking at the pain points of the economy but also the distress and misery being faced by a large section of the society who have been rendered jobless due to the outbreak.
Besides Chakraborty, the other members of the panel are expenditure secretary T V Somnathan, labour secretary Hiralal Samariya, rural development secretary Rajesh Bhushan, department of financial services additional secretary Pankaj Jain, joint secretary in Prime Minister's Office Arvind Shrivastava and deputy secretary in the Cabinet secretariat Amrapali Kata. The panel is also looking at rural distress.
Since top officials of three departments of the finance ministry are part of the group, it can be construed as the finance ministry itself.
According to sources, the group is looking at the stress in various sectors including MSME, hospitality, civil aviation, agriculture and allied sector and based on the inputs working on the stimulus package.
The comprehensive package once prepared will be vetted by the Union Cabinet headed by Prime Minister Narendra Modi and announcement would be made by finance minister Nirmala Sitharaman, the source added.
The announcement is expected to be made towards the end of lockdown so that the industry can be put on track and the economy can be reinvigorated as soon as possible.
Last month, the finance minister announced a Rs 1.7 lakh crore stimulus that included free foodgrains and cooking gas to poor for three months, and cash doles to women and poor senior citizens as it looked to ease the economic impact of the nationwide lockdown.
As per the announcement, 80 crore poor ration cardholders will each get 5 kg of wheat or rice and one kg of preferred pulses free of cost every month for the next three months, while, 20.4 crore women having Jan Dhan bank accounts would get cash help of Rs 1,500 spread over three months.
Over 8.3 crore poor women, who were handed out free cooking gas connections since 2016, will get free LPG refills for the next three months, while poor senior citizens, widows and disabled will get an ex-gratia cash of Rs 1,000.
Sitharaman had hinted at more announcements if need arises.
Meanwhile, the Union Cabinet on Monday approved a 30 per cent reduction in salary and allowances of members of parliament for one year to fight against Covid-19.
President, Vice President and governors voluntarily decided to take a pay cut as a gesture towards concerted effort to contain the spread of the deadly virus.
At the same time, the government has decided to suspend MPLADS and funds would be directed towards improving medical infrastructure.
An MP gets Rs 5 crore every year as part of the Members of Parliament Local Area Development Scheme (MPLADS).
With 693 new coronavirus cases reported since Sunday, the total number cases has crossed 4,000 in the country.