Economic Relief Package after Covid- Second Wave | 29 Jun 2021

Why in News

Recently, the Ministry of Finance announced a slew of measures to provide relief to diverse sectors affected by the second wave of Covid-19 pandemic.

  • It aims to prepare the health systems for emergency response and provide impetus for growth and employment. However it will increase the Fiscal Deficit by 0.6% as per a report of State Bank of India.
  • A total of 17 measures amounting to Rs. 6,28,993 crore were announced in the Economic Relief Package.

Key Points

  • Economic Relief from Pandemic:
  • Strengthening Public Health:
    • New Scheme for Children and Paediatric Care:
      • A new scheme for strengthening public health infrastructure and human resources with outlay of Rs. 23,220 crore was also announced.
      • It will focus on short term emergency preparedness with special emphasis on children and paediatric care/paediatric beds.
  • Growth & Employment:
    • Free one month tourist visa to 5 lakh tourists.
    • Additional Subsidy for DAP & P&K fertilizers.
    • Climate Resilient Special Traits Varieties:
      • Indian Council of Agricultural Research (ICAR) has developed biofortified crop varieties having high nutrients like protein, iron, zinc, vitamin-A.
      • These varieties are tolerant to diseases, insects, pests, drought, salinity, and flooding, early maturing and amenable to mechanical harvesting also developed.
      • 21 such varieties of rice, peas, millet, maize, soyabean, quinoa, buckwheat, winged bean, pigeon pea & sorghum will be dedicated to the nation.
    • Revival of North Eastern Regional Agricultural Marketing Corporation :
    • Boost for Project Exports:
      • It has been decided to provide an additional corpus to the National Export Insurance Account (NEIA) over 5 years. This will enable it to underwrite additional Rs. 33,000 crore of project exports.
        • NEIA Trust promotes Medium and Long Term (MLT) project exports by extending risk covers.
        • It provides cover to buyer’s credit, given by EXIM (Export-Import) Bank, to less credit-worthy borrowers and supporting project exporters.
    • Boost to Export Insurance Cover:
    • Digital India:
      • Additional Rs. 19,041 crore will be provided to implement Bharat Net in PPP model in 16 States on viability gap funding basis.
      • This will enable expansion and upgradation of Bharat Net to cover all Gram Panchayats and inhabited villages.
    • Extension of PLI Scheme:
    • Reform-Based Result-Linked Power Distribution Scheme:
    • New streamlined process for PPP Projects and Asset Monetization:
      • A new policy will be formulated for appraisal and approval of Public-Private Partnerships (PPP) proposals and monetization of core infrastructure assets, including through Infrastructure Investment Trusts (InvITs).
      • The policy will aim to ensure speedy clearance of projects to facilitate private sector’s efficiencies in financing construction and management of infrastructure.

Significance of the Package

  • It would usher in much-needed liquidity and help revive the employment-intensive sectors such as tourism.
  • It will help save livelihoods and mitigate further closures and also create new job opportunities.
  • It will bolster efforts for any such healthcare challenges in the future.
  • It will enable the Covid-affected Sectors to rise from the challenges they had faced over the past year and a half.
  • The liquidity for small businesses could indirectly revive the fortunes of larger industries they source from and help repair broken supply chains.

Source: PIB