What is the Coronavirus relief package in India?

The Coronavirus which causes the COVID-19 disease has affected the entire world with cases exponentially on a rise.

Considering the high contagiousness of the disease and to follow the social distancing factor, the government of India has taken some strict proactive measures one of which being the 21-days lockdown which was very much of a necessity to contain the virus in the second stage itself.

With the 21-day total lockdown announced, lives of majority of the workforce which belongs to the unorganized sector or the extreme poor, which depends upon daily wages, has become extremely difficult as far as their survival is concerned. Keeping this fact in mind, the government has rolled out a Relief package of $22.5 billion i.e ₹1.7 lakh crore for the poor and the ones who are hit the hardest due to the crisis.

Yesterday on March 26th, Finance Minister Nirmala Sitharaman announced this relief package aimed at providing a safety net for those hit the hardest by the lockdown, along with insurance cover for front-line medical personnel.

“We’ve immediately responded within 36 hours of the lockdown. We’ve first reached out to the poorest of the poor, who need help,” finance minister Nirmala Sitharaman said while announcing the programme on Thursday.

Stated as ‘For The Aam Aaadmi’, the package under the PM’s Garib Kalyan Yoajan includes he following steps:

1. For those on the front line –

  • ₹50 lakh of medical insurance – To cover doctors, paramedics and other medical staff.

2. For food security –

  • Additional 5kg wheat or rice per person for 3 months
  • 1kg free dal per household for 3 months
  • Free LPG for Ujjwala beneficiaries for 3 months

3. For cash in hand –

  • ₹2000 for 87 million farmers under PM kisan in 10 days
  • Increase in MGNREGS wages to ₹202 from ₹182
  • ₹500 per month to 200 million woman Jan Dhan account holders for the next 3 months
  • Ex-gratia (due to moral obligation) of ₹1000 to poor senior citizens, widows and disabled
  • 20 lakh collateral free loans for women SHGs (Self-help groups)

4. For the organized sector –

  • Govt to contribute EPF (Employee’s Provident Fund) to cos with less than 100 workers
  • Contribution for both employer and employee
  • Non-refundable advance of 75% or 3 months wages on PF account

5. For construction workers –

  • States to use ₹31k crore for construction worker’s welfare fund
  • States to use District mineral fund (trust set up as a non-profit body, in those districts affected by the mining works, to work for the interest and benefit of persons and areas affected by mining related operations.) for medical activities

Considering almost two-thirds of the total population which comes under the unorganized sector and the people who lie below the poverty line, this relief package may not be sufficient according to many economists. But the government’s quick measures to support and include all these layers of the population in such a crisis scenario will surely help get the situation under control only when the implementation is been immediately rolled out.

The State Bank of India chairman Rajnish Kumar has appreciated the decision by stating that.“It’s a very well-defined package, reinforcing government’s intent that no one should be deprived of basic facilities in today’s stressed times.”

“Other segments of society, who are also looking forward to measures such as EMI waivers, as also extension of loan scheme tenures among others, economic package shall be on wait and watch mode,” said Niranjan Hiranandani, president of Assocham.

References :

FM Nirmala Sitharaman announces Rs 1.7 lakh crore relief package for poor

Why Economists Think India’s Rs 1.7 Lakh Crore Relief Is Not Enough

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