Published On: Fri, May 15th, 2020

Centre to spend Rs 1 lakh crore on a farm infrastructure fund

New Delhi: Central government will provide 1 lakh crore rupees to set up for a agriculture infrastructure fund, its finance minister said on Friday, part of government efforts to support the economy reeling from a lockdown to tackle the coronavirus pandemic.

FM Nirmala Sitharaman on Friday briefing the media in New Delhi.

The state-run National Bank for Agriculture and Rural Development (NABARD) will raise funds to set up the new scheme, finance ministry officials said. The bank usually raises funds from lenders and the market to refinance rural infrastructure projects.

The government will also amend the Essential Commodities Act to ease restrictions on the trade of farm products, finance minister Nirmala Sitharaman told a news conference.

On Thursday, the government said farm loans amounting to 30 thousand crore rupees would be provided as additional emergency working capital to the farmers through NABARD.

The funds are part of a 20 lakh rupee fiscal and monetary package to support the economy, which has been battered by a weeks-long lockdown to curb the spread of COVID-19, the respiratory disease caused by the new coronavirus.

Under lockdown since late March, India has reported about 82,000 confirmed cases of COVID-19 among its 1.3 billion population, with more than 2,600 deaths.

Earlier this week, Sitharaman unveiled plans to provide new credit lines by offering bank guarantees on more than $60 billion of loans to small businesses, so-called shadow banks and power companies.

Since April, the government has spent 100 billion rupees to offer work to almost 2 crore 30 lakh unemployed people in rural areas under the ongoing rural job guarantee programme, Sitharaman added.

The government has also announced free food grain for about 80 million migrant workers for next two months.

It plans to extend a bank loan interest subsidy programme for affordable housing to rented housing for migrant workers, Sitharaman said.

Reuters

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