Finance Minister Nirmala Sitharaman made a big announcement for the state governments today while detailing the specifics of the 20 lakh crore economic package aimed at accelerating the sluggish economy caused by the Corona lockdown. In the wake of the Corona crisis, the central government has increased the borrowing limit of the states. The Center has raised the state’s gross domestic product (GSDP) from 3 per cent to 5 per cent. These are for 2020-21 only.
The Finance Minister said that in the year 2020-21, the state could raise loans amounting to Rs 6.41 lakh crore, 3 per cent of the state GDP. So far, the states have raised only 14 per cent of their capacity, not 86 per cent. But in view of Corona, the government can take the loan of 5% of the states GDP in the states in 2020-21, it is for one year only. This will provide an additional amount of Rs 4.28 lakh crore to the states.
The Finance Minister said that the increase of two percent to half percent has been made unconditional i.e. that states will be able to take unrestricted borrowings up to 3.5 percent of their GSDP. Out of the next one percent, 0.25 percent will be taken for one nation one ration card, 0.25 percent for ease of business, 0.25 percent for electricity distribution and 0.25 percent for revenue of urban local bodies. The final 0.5 percent borrowing will be given to the state only after the target of three of these four standards is achieved.
The finance minister said that on the request of the government, the Reserve Bank has changed the rules of overdraft to be given to the states. Now states can use the overdraft facility for 21 days instead of 14 consecutive days. Instead of a total of 32 days in a quarter, they will now be able to keep an overdraft for 50 days.
Apart from this, Nirmala Sitharaman told in the press conference on Sunday that 15 thousand crore rupees were announced to stop the corona virus in the past. In this, 4113 crore rupees were given to the states. 3750 crores was spent on essential commodities. 550 crores was given for testing kits and labs. Corona Warriors, health workers were given insurance of 50 lakh rupees.
On the change in healthcare, Nirmala Sitharaman said that the government will increase health expenditure. District level hospitals will be prepared to fight the disease caused by infection. Public health labs will be set up in every block in rural areas.
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He further said that tele communication consultancy was initiated. Millions of people used the Arogya Setu App. Like UPI Bhima, it has also been very successful in the country. The law was changed to protect health workers. There was not a single PPE company in India, today there are more than 300 units. Millions of N95 masks are being made. 11 crore HCQ tablets have been produced.
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Earlier in the fifth and last press conference, Finance Minister Nirmala Sitharaman said about the economic package of 20 lakh crores, PM Modi said in his address that there is a need to turn disaster into opportunity. The government is providing immediate financial help to the poor, providing food. He said that the era of crisis opens up new opportunities.
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Finance Minister Nirmala Sitharaman said that under the Pradhan Mantri Garib Kalyan Yojana, direct benefit transfer cash was made using technology. Under this, 2-2 thousand rupees have been given in the account of 8.19 crore farmers. Apart from this, 500-500 rupees have been sent through direct benefit transfer to 200 million Jan-Dhan accounts of the country. In this way, 10,225 crore has been added to the total 20 crore Jan Dhan accounts. Also, 6.81 crore LPG holders were given free cylinders under the Ujjwala scheme. At the same time, 2-2 thousand rupees have been sent to the account of 8.91 farmers, in which about 16 thousand 394 rupees have been spent.
Earlier, Finance Minister Nirmala Sitharaman announced the fourth installment of the Rs 20 lakh crore stimulus economic package on Saturday. The fourth installment of the package focused on policy reforms in the areas of coal, defense manufacturing, aviation, space, power distribution etc.