Recently India has declared its plans to incentive small and medium businesses as part of a $266bn (£216bn) economic package.
These spurs include an emergency credit line of security-free loans which worth $40bn to “resume commercial activity and safeguard jobs” in the wake of country’s lockdown to curb coronavirus.
Finance Minister of India Niramala Sitharamn said more measures will be brought in the coming days. India has more than approx. 70,000 confirmed cases of the virus. The economic package is same to 10% of India’s gross domestic product.
Ms Sitharaman defined a set of measures to pervade much-needed liquidity into India’s small and medium businesses as well as non-banking financial institutions, power distribution companies and micro-finance firms.
Other crucial announcements involved a move bail out more than 200,000 weak small and medium businesses and barring global tenders for government procurements value up to $26.5m to helping local businesses sell to government.
Ms Sitharaman added “The measures will spur growth and build a self-reliant India”.
She further said “The intention is to build local brands and make them world class. It’s not (about) looking inwards or (being) isolationalist. It’s (about a) confident India that contributes to the globe”.
India has been following very strict lockdown, which started on 25 March. It has had a huge economic impact, where millions of poorer, weak class Indians and migrant workers hit hardest.
On 12 May, Mr Modi said that lockdown orders would be extended beyond 17 May with new rules.
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In March, India announced it would provide about 1.7 trillion rupees in direct cash transfers and food security measures, especially for the poor.
It appears as governments and central banks in other countries have provided unprecedented levels of support for their economies in the pandemic.
Economist Madhavi Arora at Edelweiss FX and Rates opined “India’s response has so far been tepid compared to other key nations and thus the catch-up is welcome and is also the need of the hour”.
He added “It needs to be seen how much will be in the form of direct budgetary support to gauge the immediate fiscal hit and the consequent funding sources”.