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Festive stimulus: Govt to launch slew of schemes
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SME Times News Bureau | 12 Oct, 2020
Centre on Monday announced a slew of schemes to trigger economic revival via stimulus measures.
Most of these initiatives were targeted to restore spending and demand during and after the festive season.
Speaking
at a press conference, Finance Minister Nirmala Sitharaman said that
the Centre will launch ‘LTC Cash Voucher Scheme' and ‘Special Festival
Advance Scheme'.
Accordingly, the Centre expects Rs 28,000 crore worth of additional demand generation from LTC scheme.
Sitharaman
said if private sector also comes forwards with similar offering,
another Rs 28,000 crore of demand would be generated.
The
Finance Minister also announced a special festival advance of Rs 10,000
for all gazetted and non gazetted officers. This scheme, she explained
is being revived and will be one time only.
Besides, the Centre is ready to give a thrust to capital expenditure, she said.
As
per the measure, a special 50-year interest free loan to state
governments will be provided for capital expenditure for Rs 12,000
crore.
Out of the total amount, Rs 1,600 crore would be aimed
towards the north-eastern states, and Rs 900 crore loan would be
provided to Uttarakhand and Himachal.
Loans worth Rs. 7,500 crore
for other states, in proportion to share in Finance Commission
devolution, which would include 50 per cent initial disbursement and the
balance would be disbursed the use of first instalment. The unutilised
funds will be reallocated.
Further, Rs. 2,000 crore would be allocated to states which meet at least three out of four reforms announced earlier.
The
loans provided would be used for new or ongoing capital projects
needing funds and settling the bills of contractors and suppliers on
such projects.
The borrowed amount would have to be spent by March 31, 2021.
The Finance Minister said that this funding will be over and above all other additional borrowing ceilings given to states.
In
addition, the Centre's Capital expenditures budget also increased by Rs
25,000 crore this year and go with Rs 4,13,000 crore already provided
in the budget.
However, Centre's stimulus announcement did not
enthuse the key Indian equity indices which slipped during afternoon
trade session on Monday.
Accordingly, the slight fall comes right
after the Nifty50 on the National Stock Exchange (NSE) touched the
12,000 mark for the first time since February 2020, during the early
morning trade session.
Similarly, the S&P BSE Sensex made healthy gains. It crossed the 40,900 points early in the trade.
At
around 1.30 p.m., the S&P BSE Sensex traded at 40,433.14, lower by
76.35 points or 0.19 per cent from the previous close of 40,509.49.
The NSE Nifty50 traded at 11,879.70, lower by 34.50 points or 0.29 per cent from its previous close.
Analysts opined that expensive propositions along with profit booking also impacted the market sentiment.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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