National News Analysis

22 May 2024, 8:29 AM

New Delhi July 08,2020Cabinet approves Central Sector Scheme of financing facility under ‘Agriculture Infrastructure Fund’

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi today has given its approval to a new pan India Central Sector Scheme-Agriculture Infrastructure Fund. The scheme shall provide a medium – long term debt financing facility for investment in viable projects for post-harvest management Infrastructure and community farming assets through interest subvention and financial support.   Under the scheme, Rs. One Lakh Crore will be provided by banks and financial institutions as loans to Primary Agricultural Credit Societies (PACS), Marketing Cooperative Societies, Farmer Producers Organizations (FPOs), Self Help Group (SHG), Farmers, Joint Liability Groups (JLG), Multipurpose Cooperative Societies, Agri-entrepreneurs, Startups, Aggregation Infrastructure Providers and Central/State agency or Local Body sponsored Public Private Partnership Project   Loans will be disbursed in four years starting with sanction of Rs. 10,000 crorein the current year and Rs. 30,000 crore each in next three financial years.   All loans under this financing facility will have interest subvention of 3% per annum up to a limit of Rs. 2 crore. This subvention will be available for a maximum period of seven years. Further, credit guarantee coverage will be available for eligible borrowers from this financing facility under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for a loan up to Rs. 2 crore. The fee for this coverage will be paid by the Government. In case of FPOs the credit guarantee may be availed from the facility created under FPO promotion scheme of Department of Agriculture, Cooperation & Farmers Welfare (DACFW).   The total outflow as budgetary support from Government of India (GoI) will be Rs.10,736 crore: Moratorium for repayment under this financing facility may vary subject to minimum of 6 months and maximum of 2 years. The Project by way of facilitating formal credit to farm and farm processing-based activities is expected to create numerous job opportunities in rural areas. Agri Infra fund will be managed and monitored through an online Management Information System (MIS) platform. It will enable all the qualified entities to apply for loan under the fund. The online platform will also provide benefits such as transparency of interest rates offered by multiple banks, scheme details including interest subvention and credit guarantee offered, minimum documentation, faster approval process as also integration with other scheme benefits.   The National, State and District level Monitoring Committees will be set up to ensure real-time monitoring and effective feed-back. The duration of the Scheme shall be from FY2020 to FY2029 (10 years). ****** Cabinet approves the proposal to extend the EPF contribution 24% (12% employees share and 12% employers share) for another three months from June to August 2020 under PMGKY/AATMANIRBHAR BHARAT The Union Cabinet chaired by the Prime Minister Shri Narendra Modi today has given its approval for extending the contribution both 12% employees’ share and 12% employers’ share under Employees Provident Fund, totaling 24% for another 3 months from June to August, 2020, as part of the package announced by the Government under Pradhan Mantri Garib Kalyan Yojana (PMGKY)/ Aatmanirbhar Bharat in the light of COVID-19, a Pandemic.    This approval is in addition to the existing scheme for the wage months of March to May, 2020 approved on 15.04.2020.  The total estimated expenditure is of Rs.4,860 crore.  Over 72 lakh employees in 3.67 lakh establishments will be benefitted.   Salient Features:             The salient features of the proposal are as under:   For the wage months of June, July and August, 2020, the scheme will cover all the establishments having upto 100 employees and 90% of such employees earning less than Rs. 15,000 monthly wage. About 72.22 lakh workers working in 3.67 lakh establishments will be benefited and would likely to continue on their payrolls despite disruptions. Government will provide Budgetary Support of Rs.4800 crore for the year 2020-21 for this purpose. The beneficiaries entitled for 12% employers’ contribution for the months of June to August, 2020 under Pradhan Mantri Rozgar Protsahan Yojana (PMRPY) will be excluded to prevent overlapping benefit. Due to prolonged lockdown, it was felt that businesses continue to face financial crisis as they get back to work. Therefore, the Hon’ble FM, as part of Aatmanirbhar Bharat, announced on 13.5.2020 that the EPF support for business and workers will be extended by another 3 months viz. for the wage months of June, July, and August, 2020.       The steps taken by the Government from time to time to ameliorate the hardships faced by the low paid workers are well accepted by the stakeholders.  **************** Cabinet approves developing of Affordable rental housing Complexes for urban migrants / poor The Union Cabinetchaired by the Prime Minister, Shri Narendra Modi has given its approval for developing of Affordable Rental Housing Complexes (AHRCs) for urban migrants  / poor as a sub-scheme under Pradhan MantriAwasYojana – Urban (PMAY – U) by:   existing vacant government funded housing complexes will be converted in ARHCs through Concession Agreements for 25 years. Concessionaire will make the complexes livable by repair/retrofit and maintenance of rooms and filling up infrastructure gaps like water, sewer/ septage, sanitation, road etc. States/UTs will select concessionaire through transparent bidding. Complexes will revert to ULB after 25 years to restart next cycle like earlier or run on their own.   special incentives like use permission, 50% additional FAR/FSI, concessional loan at priority sector lending rate, tax reliefs at par with affordable housing etc. will be offered to private/ public entities to develop ARHCs on their own available vacant land for 25 years.   A large part of workforce in manufacturing industries, service providers in hospitality, health, domestic/commercial establishments, and construction or other sectors, labourers, students etc. who come from rural areas or small towns seeking better opportunities will be the target beneficiary under ARHCs.   An expenditure of Rs 600 Crore is estimated in the form of Technology Innovation Grant which will be released for projects using identified innovative technologies for construction. Approximately,three Lakh beneficiaries will be covered initially under ARHCs.   ARHCs will create new ecosystem in urban areas making housing available at affordable rent close to the place of work. Investment under ARHCs is expected to create new job opportunities. ARHCs will cut down unnecessary travel, congestion and pollution.   Government funded vacant housing stock will be converted into ARHCs for economically productive use. The scheme would create a conducive environment for Entities to develop AHRCs on their own vacant land which will enable new investment opportunities and promote entrepreneurship in rental housing sector.   Background: Ministry of Housing & Urban Affairs (MoHUA) has initiated an Affordable Rental Housing Complexes (ARHCs) for urban migrants/poor as a sub-scheme under Pradhan MantriAwasYojana (Urban). The scheme was announced by the Hon’ble Finance Minister on 14 May, 2020. This scheme seeks to fulfill the vision of ‘AtmaNirbhar Bharat.   COVID-19 pandemic has resulted in massive reverse migration of workers/ urban poor in the country who come from rural areas or small towns for seeking better employment opportunities in urban areas. Usually, these migrants live in slums, informal/ unauthorized colonies or peri-urban areas to save rental charges. They spend lot of time on roads by walking/ cycling to workplaces, risking their lives to cut on the expenses.   ****** Cabinet approves extension of time limit for availing the benefits of “Pradhan Mantri Garib Kalyan Yojana” for Ujjwala beneficiaries by three months w.e.f. 01.07.2020 The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has approved the proposal of Ministry of Petroleum & Natural Gas for extension of time limit by three months w.e.f. 01.07.2020 for availing the benefits of “Pradhan Mantri Garib Kalyan Yojana” for Ujjwala beneficiaries   The Government had announced a relief package ” Pradhan Mantri Garib Kalyan Yojana” aimed at providing a safety net to the poor and vulnerable who had been hit the hardest by the pandemic. The package also included relief for poor families who had availed of an LPG connection under PMUY. Under the PMGKY-Ujjwala, it was decided to provide free of cost refills for PMUY consumers for a period of 3 months w.e.f. 01.04.2020.   Under the Scheme, Rs. 9709.86 Cr was transferred directly into the bank accounts of Ujjwala beneficiaries during April- June 2020 and 11.97 Crore cylinders were delivered to the PMUY beneficiaries. The scheme went a long way to ameliorate the suffering and disruption caused due to the Coronavirus pandemic.   On review of the scheme, it has been observed that a section of PMUY beneficiaries are yet to utilize the advance credited into their account to purchase the cylinder refill within the scheme period. Hence, the Cabinet has approved the proposal of the Ministry of Petroleum & Natural Gas to extend the time-limit for availing the advance by three months. This will benefit those PMUY beneficiaries who have been credited with the advance for buying the cylinder, but have not been able to purchase the refill. Thus, the beneficiaries who already have the advance transferred to their account can now take the free refill delivery till 30th September.   ***************** Cabinet approves extension of Pradhan Mantri Garib Kalyan package-Pradhan Mantri Garib Kalyan Anna Yojana – distribution of free of cost Whole Chana for five months from July to November, 2020 The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has approved further extension of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) as part of Economic Response to COVID-19, for another Five months from July to November, 2020.   Under the Scheme it is proposed to distribute 9.7 Lakh MT cleaned whole Chana to States/UTs for distribution to all beneficiary households under the National Food Security Act, 2013 (NFSA) @ 1kg per month free of cost under for next five months -July to November, 2020 at a total estimated cost of Rs.6,849.24 crore.   About 19.4 crore households would be covered under the Scheme. All expenses on the extended PMGKAY are to be borne by the Central Government. Extension of the Yojana is in line with the commitments of the Government of India not to allow any body, especially any poor family, to suffer on account of non-availability of food grains due to disruption during next five months. Free distribution of whole Chana will also ensure adequate availability of protein to all the above-mentioned individuals during these five months.   The distribution of pulses for the package emanated from robust availability of stock in the buffer which was set up in 2015-2016. Government of India has sufficient stocks of Gram for distribution for the extended period of PMGKAY.   In the first phase of the PMGKAY (from April to June 2020), 4.63 lakh MTs of pulses have been distributed already, benefiting 18.2 Cr. households across the country.   Background: The Prime Minister on 30.6.2020 announced the extension of the Pradhan Mantri Garib Kalyan package till end of November, 2020 to ameliorate the hardship faced by the underprivileged or poor on the account of economic disruption caused by the Corona Virus and Lock Down.   ************ Cabinet approves capital infusion for the three Public Sector General Insurance Companies – Oriental Insurance Company Limited, National Insurance Company Limited and United India Insurance Company Limited The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has approved the capital infusion for an overall value of Rs.12,450 crore; (including Rs. 2,500 crore infused in FY 2019-20) in the three Public Sector General Insurance Companies (PSGICs) namely Oriental Insurance Company Limited (OlCL), National Insurance Company Limited (NICL) and United India Insurance Company Limited (UIICL) but of which Rs.3,475 crore will be released immediately; while the balance Rs,6475 crore will be infused later.   Cabinet also approved increase in authorised share capital of NICL to Rs.7,500crore and that of UIICL and OlCL to Rs 5,000 crore respectively to give effect to the capital infusion. Further, the process of merger has been ceased so far in view of the current scenario and instead, the focus shall be on their profitable growth.   The capital infusion of Rs.3,475 Crore will be allocated to three PSGICs viz. OlCL, NICL and UIICL as the first tranche in the current financial year and the. balance amount will be released in one or more tranches. To give effect to the infusion, the authorised capital of NICL will be increased to Rs. 7,500 Crore and that of UIICL and OlCL to Rs.5,000 Crore respectively.   Impact The capital infusion will enable the three PSGICs to improve their financial and solvency position, meet the insurance needs of the economy, absorb changes and enhance the capacity to raise resources and improved risk management.   Financial implications: In the current financial year, the immediate financial implication would be Rs.3,475 crore as a result of capital infusion in three PSGICs namelyOlCL, NICL and UIICL as the first tranche which will be followed by Rs. 6,475 Crore.   Way forward: To ensure optimum utilization of the capital being provided, the Government has issued guidelines in the form of KPIs aimed at bringing business efficiency and profitable growth. In the meanwhile, given the current scenario, the process of merger has been ceased so far and/instead focus shall be on their solvency and profitable growth, post capital infusion. ***** Cabinet approves extension of Pradhan Mantri Garib Kalyan Anna Yojana – allocation of additional foodgrain for further five months from July to November, 2020 The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has approved further extension of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) as part of Economic Response to COVID-19 for additional allocation of food-grains from the Central Pool for another Five months from July to November, 2020.   In the month of March 2020, the Government of India announced the ‘Pradhan Mantri Garib Kalyan Package (PMGKP)1 to ameliorate the hardships faced by the poor due to economic disruptions caused by the Covid-19 in the country. This package inter-alia comprises the implementation of “Pradhan Mantri Garib Kalyan Anna Yojana (PM-GKAY)”, through which additional free-of-cost foodgrains (Rice/Wheat) at the scale of 5 Kg per person per month are being provided to about 81 Crore beneficiaries covered under National Food Security Act, 2013 (NFSA), so that poor and vulnerable families/beneficiaries are able to access food-grains easily without facing any financial distress. Under this programme initially, free food-grains for three months i.e. April, May and June were provided.   However, keeping in view the need for continuous support to the poor and the needy, the PM-GKAY scheme has been extended further for a period of next 5 months i.e. July- November 2020.   Earlier, under PMGKAY, this Department on 30/03/2020, had allocated a total of about 120 Lakh Metric Tons (LMT) foodgrains to the States/UTs to be distributed-for three months (April-June, 2020). Accordingly, the FCI and other State Agencies have delivered over 116.5 LMT (97%) of total 120 LMT of food-grains to all the States/UTs for distribution under this special scheme. So far, all States/UTs combined have reported the distribution of nearly107 LMT (89% of allocated food-grain) for the period April-June, 2020. So far, about 74.3 Cr. Beneficiaries have been covered in April and 74.75 Cr. Beneficiaries have been covered in May and about 64.72 Cr, beneficiaries in June 2020 have taken the benefit of these additional free-of-cost foodgrains over and above their regular NFSA food-grains. The distribution is ongoing and reporting of distribution figures will be updated once distribution is complete. Some States also distributed PM-GKAY food-grains for two-or-three months at one-go, owing to various logistical reasons.   Under the regular NFSA distribution, during the months of April, May and June 2020, about 252 LMT of NFSA and PM-GKAY foodgrains were moved by FCI all over the country using their robust supply network. Remote and inaccessible locations were continuously fed through other modes like Air and Water routes for timely supply of food-grains to reach out to beneficiaries. It is worth mentioning that, while maintaining the supply chains very efficiently even during the complete lockdown, FCI and the Department ensured uninterrupted delivery of foodgrains to beneficiaries, under the NFSA and PM-GKAY scheme. Further, IT driven PDS reforms, like, digitised EPoS machine network of nearly 4.88lakh (90.3%) out of total 5.4 lakh Fair Price Shops (FPSs) and End-to-End Computerization of Targeted Public Distribution System (TPDS) and Supply Chain Management were leveraged during the testing times despite temporary temporary suspension of biometric authentication in many states.   During April-May-June last year 2019, this Department had allocated a total of about 130.2 LMT of foodgrains under NFSA out of which a total of nearly 123 LMT (95% foodgrain) were lifted by the States/UTs. Whereas, during the same period of three months April-May-June 2020, this Department had allocated a total of about 252 LMT foodgrains for the same beneficiaries (132 LMT under NFSA and 120 LMT under PMGKAY), out of which more than 247 LMT have been lifted and 226 LMT have been distributed so far to the NFSA beneficiaries during the last three months which shows that nearly double the normal quantity off food-grains have been distributed as much needed succour to people.   With the current extension of PMGKAY for another 5 months till November. 2020, the same robust supply and distribution of food-grains shall be sustained. This would entail an additional estimated expenditure of Rs 76062 crore on account of cost and distribution of food-grains.

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