Here is a short overview of 20 lakh crore economic relief package introduced by the government of India under Aatmanirbhar Bharat to revive the economy from the effects of COVID-19.

1. Government of India 20 Lakh
Crore COVID Package
PRESENTED BY:
KAJAL JHA

2. INTRODUCTION:
• On 12th May 2020 Prime Minister Narendra Modi, announced a 20 lakh crore package.
• It was announced under Aatmanirbhar Bharat.
• The package is equivalent to 10% of India’s GDP.
• The economic relief package was undertaken by the government in 5 tranches.
• The overall package stood at Rs. 20,97,053 crore.
• The government has combined the fiscal and the monetary policies in the 20 lakh crore package

4. VISION:
• The objective of the Indian government behind announcing Rs. 20 lakh crore package is to jump start
the economy after the setback that it has faced due to the COVID-19 pandemic.
• RBI is taking initiatives to bring liquidity in the economy.
• Reforms for MSME will help them to come out, start fresh and develop.
• Job creation will help to motivate the youth of the country.
• Other initiatives like ‘Vocal for Local’ and ‘One nation one ration card’ is taken to become Self-Reliant.

5. Measures taken by RBI:
• Cutting down of repo rate.
• Earlier the repo rate was 5.15% and now it has been reduced to 4.4%.
• Cutting down the reverse repo rate.
• Earlier the reverse repo rate was 4% but now it has been reduced to 3.35%.
• RBI also announced that lenders could give a moratorium of 3 months on term loans, outstanding as
on 1 March, 2020.
• There was also a reduction of 1% in cash reserve ratio.

6. Measures announced by PM:
• Prime Minister Narendra Modi announced a Rs. 1.92 lakh crore package
• Under this Rs. 500 was given to almost 20 crore women holding Jan Dhan account.
• LPG cylinders were made available free of cost to almost 8 crore poor people for 3 months.
• Rs. 1,000 was given to poor senior citizens to fight the tough times.
• Along with all these measures, various health insurance benefits were also provided to health workers.

7. First tranche for MSME sector:
• The government has announced Rs. 5,94,550 crore for this sector in order to ensure liquidity.
• It includes Rs 3 lakh crore collateral-free loans and Rs 50,000 crore equity infusions for MSMEs through
Fund of Funds.
• Liquidity relief measures worth Rs 30,000 crore were also announced for NBFCs, HFCs etc. and Rs
90,000 crore for power distribution companies.
• Government took these measures to revive the MSME sector and help the entrepreneurs to regain
their capacity and start their business again.
• PM has also put up the importance of becoming ‘Vocal for Local’ in order to grow.

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9. Second tranche for migrant workers:
• The package announced for second tranche was of Rs. 3,10,000 crore.
• The government introduced ‘one nation one ration card’ to allow migrant workers to buy ration from
any depot in the country.
• A special credit facility of Rs 5,000 crore was announced to support around 50 lakh street vendors who
will have access to an initial Rs 10,000 working capital.
• The government also announced that close to Rs 2 lakh crore will be given to farmers through Kisan
credit cards while 2.5 crore farmers, including fishermen and animal husbandry farmers, would be able
to get institutional credit at a concessional rate.

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11. Third tranche for agriculture and allied sector:
• The package of Rs. 1,50,000 crore was announced.
• The focus of the government was on agriculture and allied sector including dairy, animal husbandry
and fisheries.
• The government has announced Rs 1 lakh crore agriculture infrastructures like post-harvest
management infrastructure.
• Other key announcements made by the government included
o Rs. 20,000 – fishermen
o Rs. 10,000 crore - Micro food enterprises.
o Rs. 4,000 crore - Herbal cultivation,
o Rs. 15,000 crore - Animal Husbandry Infrastructure Development Fund
o Rs. 500 crore - Bee-keeping

13. Fourth and the fifth tranche for other sectors and job
creation:
• The final tranche of relief package was announced for sectors including coal, minerals, defense production,
air space management, airports etc.
• The package of Rs. 48,100 crore was announced.
• The government announced easing utilization of the Indian air space to reduce air travel cost.
• It was also announced that the commercial mining in the coal sector and privatizing discoms in metros to
streamline their functions for better accountability.
• The government also allocated an additional Rs 40,000 crore for the Mahatma Gandhi National Rural
Employment Guarantee Act (MGNREGA) for job creation in India.

15. Impact of the package:
• The 20 lakh crore package that has been introduced by the Indian government as an economic relief
package, will have a positive effect on the economy and will help many sectors to come out of the
recession that they had due to the lockdown in response to global pandemic.
• The RBI has increased the liquidity in the market.
• The PMGP announced by the government will help the poor people in the country to sustain their life.
• Measures like ‘Vocal for Local’ and ‘one nation one ration card’ will also help the country to grow from the
inside.
• The country will become strong if the MSME sector develops.
• The agriculture and other sectors will also get the benefit of the package.
• Job creation is also one of the major steps taken by the government.

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