In her second press conference in as many days, the Finance Minister also announced an affordable rental housing scheme for migrant workers besides Rs 5,000 crore special credit facility for almost 50 lakh street vendors.
The measures are part of a 20 trillion rupee fiscal and monetary package announced by Prime Minister Narendra Modi on Tuesday to support the economy, which has been battered by a weeks-long lockdown to curb the virus' spread. This will help the nation to become self-reliant.
The efficacy of the stimulus packages introduced by various countries would depend on their focus and if they would stimulate the purchasing power of the people.
He said that the Prime Minister's resolve of making India "self-reliant" has filled new energy in people.
This has changed the way the world views India today, he said. It will cater to the needs of various sections of the society, including the cottage industry, MSMEs, labourers, middle class, and industries.
The economic package is equivalent to 10% of India's gross domestic product. In countries such as Australia, the United Kingdom or the USA, the tax-GDP ratios are far higher than ours.
"The package will help generate more employment within the country". India's service industry has witnessed a severe collapse, too, as Asia's third-biggest economy reported a headline index figure of 5.4 in April, a drop of over 40 percent, implying that the severe social distancing protocols are causing the sector grinding to a complete standstill.
Shah said the way India has fought the novel coronavirus pandemic under the leadership of Modi, the country has given a new direction to the whole world. Moreover, the Rs 20,00,000 crore stimulus nearly equals to 17% of the BSE.
Sitharaman said the package would be partly funded through additional government borrowing already announced. Further, he said that it would lead to a re-examination of everything, whether APMC or labour laws.
The abrupt halt of commercial activity threatens to impose economic pain so profound and enduring in every region of the world at once that recovery could take years. Self-reliance will prepare India for tough competition in the global supply chain.
Initially well received by India's business community and stock markets, these measures will go some way towards helping companies to at least partially resume operations once the lockdown eases. Indian President Narendra Modi is expected to announce that the new extension will last until May 31. That will be anchored by state-run National Bank for Agriculture and Rural Development (NABARD), with no extra spending by the government. From then onwards, RBI announced in several stages.
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