India Inc seeks Rs 2 trillion in govt relief as lockdown hits businesses

Topics Coronavirus | FICCI | Lockdown

The finance ministry is working on one more booster dose to give a leg-up to the economy.
India Inc on Wednesday sought Rs 2 trillion as economic package to tide over losses from the 21-day nationwide lockdown to prevent the spread of the coronavirus. 

The Confederation of Indian Industry (CII) has submitted recommendations to the government seeking an "economic package" entailing additional support to the lowest strata and the informal sector through cash transfers, amounting to Rs 2 lakh crore to Jan Dhan account holders, PTI reported. 

It also suggested the Centre enhancing credit limits for working capital across the board to all industries and additional reconstruction term loans to MSMEs (micro, small and medium enterprises) and stressed sectors with a government guarantee on default, up to 20 per cent.  Another industry chamber Assocham has also sought a "stimulus package" of at least USD 200-USD 300 billion "to thwart one of the deepest global recession expected in the world's history", PTI quoted Secretary-General Deepak Sood as saying.

He said the chamber believes that in keeping up with most economies of the world to institute stimulus measures with 10 per cent of the gross domestic product, the Indian economy would need a transfusion of over USD200 billion with an ability to go up to $300 billion, over the next 12-18 months.

In its submission, FICCI has recommended that an additional sum of Rs one trillion (over and above the PM Gareeb Kalyan Scheme) must be earmarked and transferred to states to supplement their efforts to cater to the immediate needs of the poor and informal sector workers. It also suggested that interest-free and collateral-free loans be given to MSMEs having a turnover of less than Rs 500 crore for a period of up to 12 months, to enable them to cover fixed costs, salaries and other operational expenses.

It also suggested the Centre to enhance credit limits for working capital across the board to all industries and additional reconstruction term loans to MSMEs.

It is to be noted that The finance ministry is working on one more booster dose to give a leg-up to the economy that has hit over the six-year low of 5 per cent. The blueprint for the stimulus is ready that would be announced by Finance Minister Nirmala Sitharaman in the next few days. The government announced a slew of measures in three dosages which include a special window for real estate, export incentives, bank consolidation and sops for micro, small and medium enterprises (MSMEs) and the automobile sector.

RBI Governor Shaktikanta Das had earlier said the government has taken a number of measures to boost the economy in three phases and indicated that more steps are likely.

The first set of announcements was made on August 23 that included a rollback of the enhanced surcharge imposed on foreign portfolio and domestic investors in Budget 2019-20.


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