Gujarat Exclusive > National-World > Centre announces slew of measures to boost economic downturn due to COVID-19

Centre announces slew of measures to boost economic downturn due to COVID-19


Union finance minister Nirmala Sitharaman on Monday announced eight new schemes to boost the economy ravaged by the COVID-19 pandemic, with a special focus on the health and tourism sector. Notably, the Indian economy contracted by 7.3 per cent in the 2020-21 financial year.

The measures unveiled by the finance minister assumes significance in the backdrop of the RBI’s estimate in its monthly bulletin for June 2021 that the second COVID-19 wave may result in a loss of Rs 2 lakh crore during the current financial year as region-specific containment measures and the virus’ spread into smaller cities and villages sapped rural demand.

The major announcements by Sitharaman include Rs 1.1 lakh crore loan guarantee scheme for the COVID-affected and an additional Rs 1.5 lakh crore under the Emergency Credit Line Guarantee Scheme (ECLGS) that was launched as part of the Atmanirbhar Bharat package in 2020. The development comes as the country is bracing for a possible third wave of the deadly virus.

Schemes for health & tourism sector

The Union finance minister announced additional Rs 23,000 crore for public health in light of the health crisis of the century. She has also promised support to the battered tourism sector in the form of a Rs 10 lakh loan to travel agencies and a Rs 1 lakh loan to tourist guides. The finance minister also said that tourist visas will be provided free to the first 500,000 tourists when the process begins.

Among other measures, Sitharaman announced the widening of the Emergency Credit Line Guarantee Scheme, under which collateral-free loans are given to MSMEs. She also announced a new scheme to give up to Rs 1.25 lakh loan to 25 lakh small borrowers at lower interest rates.

Earlier measures

The government has announced several measures since the beginning of the COVID pandemic, including the first stimulus package called Aatmnirbhar Bharat in May last year. That package had included monetary and fiscal support worth Rs 21 lakh crore, which the government had said was equivalent to 10 per cent of the country’s GDP.


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