Finance Minister Ms Nirmala Sitharaman on Thursday, 14th May 2020 made an announcement with further measures under the economic package that the Honorable Prime Minister Mr Modi had earlier declared. This announcement can be termed as Economic Package phase-2 of the overall economic package promised to the country by the Government, post the earlier measures announced a day earlier.
Economic Package Phase 2 for *Migrant Labour *
1. Free dry food– To help and support the migrant labourers, so that they have enough food, Government announced a scheme which will be funded by the centre and run by the state. Under the scheme, the migrant labour, who are not covered by NFSA nor are the state card beneficiaries would be entitled to 5kgs of rice per person and 1 kg of chana per family for 2 months. This is expected to benefit 8 cr migrant labourers and cost the centre amount of 3500 cr. This is a noble scheme which ensures that the migrant labour, who have been displaced and are short of work and income, do not have to worry for food.
2. One nation one ration card– This will benefit the migrant labourers more than anyone else. The scheme which will have 100% coverage by 31st March 2021 aims at enabling anyone covered by ration card under PDS, can go to any fair priced PDS shop and get his or her ration from there. There would be no attachment of the card to a particular shop. The technology-driven scheme will be further helpful in keeping in transparent monitoring of the entire PDS system.
3. Affordable rental accommodation– A scheme launched by Pradhan Mantri Awas Yojna (PMAY) for migrant labour and urban poor. The aim is to convert the government-funded housing project in cities into affordable rental housing complexes (ARHC) to be run on PPP mode. The government will incentivise the industrial units, manufacturing units, industries, institutions etc, to develop ARHC on their private land and operate. Central and State Government agencies, PSUs and other Government organisations will be encouraged to operate on the same module.
Economic Package Phase 2 for *Small business and street vendors *
4. Interest subvention for MUDRA, Shishu loans– Government to provide interest subvention of 2% on such Mudra –Shishu loans for prompt payees for a period of 12 months. This will be costing centre 1500 cr.
5. Special Credit facility for Street vendors-Street vendors have been virtually brought to a standstill and could not carry on business at all during the lockdown. With an aim to provide a kick start to their street vending business, the government will bring a credit lending scheme for them. An initial loan of 10000 can be availed by an estimated 50 lakh street vendors ( this figure is estimated based on inputs from various state governments) This will infuse 5K crores of liquidity into the economy.
Economic Package Phase 2 for *Farmers*
6. Emergency working capital through NABARD– Small and marginal farmers have been adversely affected due to lockdown. The government through NABARD will extend additional refinance support of up to 30k crore in the aggregate to RRBs and rural cooperative banks for crop loan requirement. This, in turn, will benefit 3 crore small and marginal farmers to meet the post-harvest requirement of Rabi crops and Kharif crops in May and June.
7. Concessional credit boost through Kisan Credit cards- A special drive will be undertaken to provide concessional credit facility to PM-KISAN beneficiaries through Kisan Credit Cards. Further, the fisherman and animal husbandry farmers will also be covered in the scheme. 2.5 crore farmers will get benefits under the scheme amounting to 2 Lakh crore.
*Job opportunities * under Economic Package Phase 2
8. Employment through CAMPA fund– The government will approve, shortly, plans worth 6000crores to provide employment opportunities to citizens –mainly tribal people/ Adivasis/ others in urban / semi-urban/ rural areas. This will be done through Compensatory Afforestation Management and Planning Authority (CAMPA). Funds to be used by state governments for afforestation and plantation work, artificially assisted natural regeneration, forest management, soil conservation, forest protection, forest and wildlife infrastructure development, wildlife protection etc.
Economic Package Phase 2 for *Housing sector*
9. Credit Linked Subsidy Scheme (CLSS)- CLSS for a small and middle class within income bracket of 6L-18L was supposed to end on 31-3-2020 but has been extended up to 31-3-2021. This will benefit approximately 2.5Lakh families in getting subsidy on the loan undertaken by under Affordable housing scheme. This will lead to an investment of up to Rupees 70,000 crore in the housing sector and will benefit the allied industries like cement, steel, transport and other construction material suppliers, in addition, to provide own home to many families.
Economic Package Phase 2 *Reforms to labour code *
A series of changes and amendments have been announced to bring reforms to labour codes for the benefit of the labour and their employers. The measures over and above the ones specified above are listed below-
- Extension of ESIC coverage on PAN India basis, which will be applicable to any establishment employing more than 10 people as against in notified areas only. Further, the hazardous and dangerous industries will be brought under the preview of ESIC even if employing less than 10 people.
- Statutory concept of national floor wage is introduced, which will reduce the regional disparity in minimum wages.
- Fixation of minimum wage simplified to lessen the number of rates of minimum wages.
- Appointment letter for workers is a must now, which will help in formalising the things.
- Annual health check-up of employees and Occupational safety and health code to be applicable for industries employing less than 10 people also.
- Social Security scheme for Gig workers and platform workers and unorganised workers.
- A re-skilling fund set up for retrenched workers.
- All occupations opened for women and allowed to work in night shifts with adequate safety measures being in place.
- Gratuity on fixed-term employment. Provisions of gratuity will be applicable on completion of 1 year of service instead of earlier 5 years.
The finance minister will come out with part -3 of list of measures on Friday 15th May 2020.