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Tata Capital > Blog > COVID-19 > Government Updates > Key highlights from Finance Minister’s Second Speech on COVID Relief Package

Government Updates

Key highlights from Finance Minister’s Second Speech on COVID Relief Package

Key highlights from Finance Minister’s Second Speech on COVID Relief Package

Following the first press conference on 13 May 2020, the Indian Finance Minister (FM) made the second tranche of announcements at a press conference on 14 May 2020. The announcements covered measures aimed at migrant workers, small farmers and street vendors besides covering affordable housing.

The FM recounted the various measures initiated by governments during the COVID lockdown to various sections of society. In the backdrop of the earlier measures the FM made further announcements of the measures for the intended segments of the society.

The key highlights of the measures are as follows:

1. Migrant workers

The FM commiserated with the plight of migrant workers and announced the following measures to mitigate their hardships:

       Free food grains for two months

  • The central government will make available through state governments 5 kg of rice or wheat and 1 kg of chana per month for the next two months free of cost to about 8 crore migrant workers
  • This measure is applicable to all migrant workers including those who do not have NFSA or state documentation  
  • The state governments will draw up the list and distribute the provisions
  • The central government will spend Rs 3,500 crore on this measure
Free food grains for migrant workers

       One Nation One Ration Card (ONORC)

  • National portability of ration cards under the ONORC System will enable migrant workers to avail benefits under the PDS wherever they may be located in any part of India
  • By August 2020, ONORC would cover 23 states accounting for 83% of PDS population covering 67 crore people
  • 100% national portability would be achieved by March 2021
One Nation One Ration Card

Additional Read – “ What is the One Nation One Ration Card System?”

       MGNREGS Work

  • Migrant workers who have returned to their home states will be provided work under MGNREGS
  • As of 13 May 2020, about 2.33 crore wage seekers in 1.87 lakh gram panchayats have been offered work

        Rental Accommodation        

  • Rental accommodation for migrant workers is being enhanced by offering incentives to private manufacturing and industrial units, associations and organizations to create Affordable Rental Housing Complexes (ARHC) on their private land
  • Converting government funded housing into ARHC through concessionaires on PPP mode
  • Offering incentive to central and state government agencies to build and operate ARHC
  • The migrant workers can make use of the ARHC to rent accommodation for themselves
  • This scheme will be implemented under PM Awas Yojana

2. MUDRA Shishu loan

  • Under the MUDRA Shishu Loan scheme, people who have availed loans up to Rs 50,000 will be eligible for interest subvention of 2% for next 12 months. This will kick in after RBI moratorium period ends
  • This measure will benefit 3 crore people and the central government will bear the cost of Rs 1,500 towards this measure

3. Street Vendors

  • Street vendors will be provided up to Rs 10,000 working capital loan facility to commence work once the lockdown is lifted
  • The central government is making a provision of Rs 5,000 crore for this measure
  • Street vendors will be eligible for monetary rewards for making digital payments and can avail more benefits for prompt repayment action
  • This measure will benefit 50 lakh street vendors   

4. Middle Income Group - Affordable Housing

  • The Credit-linked subsidy scheme (CLSS) for middle income households with an income between Rs 6 and 18 lakh, started in May 2017 and ending March 2020, will be extended up to March 2021. The extension will spur investments of Rs 70,000 crore in housing having a cascading effect on sectors such as steel, cement, construction materials and transportation besides creating numerous jobs
  • So far 3.3 lakh MIG households have taken benefit under this scheme, and the extension would benefit an additional 2.5 lakh MIG households

5. Tribal Welfare

  • Tribal citizens and adivasis will benefit from CAMPA (Compensatory Afforestation and Management Planning Authority) funds of Rs 6,000 crore earmarked for creating jobs for this group
  • State governments can use the funds for works related to artificial and natural regeneration, forest management, soil and moisture conservation, forest protection, development of forest and wildlife infrastructure, wildlife protection and management
  • Rural, semi-urban and urban areas will be covered under the measure

6. Small and marginal farmers

  • Farmers will get additional emergency working capital funding through NABARD to the tune of Rs 30,000 crore through RRBs and Rural Cooperative Banks. This is over and above Rs 90,000 crore existing normal refinance route
  • This measure will benefit 3 crore farmers who can utilize the funds for post harvest Rabi crop and ensuing Kharif sowing season

       Kisan Credit Card

  • The Kisan Credit Card scheme will be extended to an additional 2.5 crore farmers, including fishermen and animal husbandry farmers
  • The scheme offers credit at concessional rate of interest
  • The credit flow will be Rs 2 lakh crore

As can be seen from the measures announced the government is addressing the needs of different sections of society and economy firstly to mitigate their hardships and secondly to allow them to continue their livelihood in the post COVID period.

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