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The
government will expand federal guarantees on loans to businesses
to 4.5 trillion rupees ($60.7 billion) from an earlier limit of
3 trillion rupees, finance minister Nirmala Sitharaman told
reporters.
The government will provide a guarantee of 1.1 trillion rupees
on loans to the health sector and medical infrastructure, she
said, that will enable them to raise loans at a lower interest
rate of 8-8.25% a year.
The Emergency Credit Line Guarantee Scheme (ECLGS), launched
last year, has helped cash-starved small businesses raise funds
during the COVID-19 lockdown for working capital and to meet
their orders.
The government will extend benefits from the free foodgrain
programme for poor people, launched last year, till November
that will cost 938.7 billion rupees, bringing the total cost of
the programme to more than 2.27 trillion rupees, she said.
A slow vaccination drive and local restrictions after a massive
second wave of infections and deaths across the country have hit
economic activities such as retail, transport and construction
while putting millions out of work.
India's economic growth rate picked up in January-March to 1.6%
from a year earlier, but economists are increasingly pessimistic
about this quarter after a huge second wave of COVID-19
infections hit the country in April-May.
($1 = 74.2125 Indian rupees)
(Reporting by Aftab Ahmed and Manoj Kumar; Editing by Toby
Chopra and Jacqueline Wong)
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