In a progress report of the flagship Atma Nirbhar Bharat package, the government said that refinancing will benefit 3 crore farmers in meeting their credit needs for post-harvest and kharif sowing requirements.
Under Prime Minister Narendra Modi’s Atma Nirbhar Bharat package, the government has front-loaded liquidity in the regional rural banks and cooperative banks. The RRBs and cooperative banks have received a special refinance facility of Rs 30,000 crore sanctioned by NABARD, according to the Ministry of Finance. In a progress report of the flagship Atma Nirbhar Bharat package, the government said that this special facility will benefit 3 crore farmers, mostly small and marginal farmers, in meeting their credit needs for post-harvest and kharif sowing requirements. While the kharif sowing is on its full swing, Rs 24,876.87 crore out of Rs 30,000 crore has already been disbursed as on 6 July, it added.
Among other developments under the self-reliant India mission, the government further highlighted that the banks have also approved the purchase of Rs 14,000 crore portfolio and are currently in the process of approval for Rs 6,000 crore as on 3 July 2020, under the Partial Credit Guarantee Scheme (PCGS). Under the scheme, existing PCGS will be revamped and extended to cover the borrowings of lower-rated NBFCs, HFCs, and other Micro Finance Institutions (MFIs).
To lower the risks, the government has also pledged to provide 20 per cent first loss sovereign guarantee to the PSU banks. A first loss guarantee is a form of credit enhancement in which an investor has additional recourse to the third party for a stated percentage of any obligation or a percentage of any losses.
In other major achievements, the government has listed out that that the global tenders will be disallowed in government procurement tenders up to Rs 200 crore unless prior approval is obtained from the cabinet secretariat. TO provide relief to contractors, the Department of Expenditure has issued instructions that on the invocation of Force Majeure Clause (FMC), the contract period may be extended for a period between 3-6 months without the imposition of any cost or penalty on the contractor.
Watch: News with Financial Express July 13, 2020
Meanwhile, regarding the Rs 3 lakh crore collateral-free automatic loans for businesses, including MSMEs, the government has underlined that the Department of Financial Services has issued operational guidelines for the scheme and Emergency Credit Line Guarantee Scheme (ECLGS) Fund has already been registered. It also mentioned that in a short period of about one and a half months, there has been noticeable progress in identifying units, sanctioning as well as disbursing of loans to MSMEs. Out of Rs 1.2 lakh crore sanctioned so far under this scheme, Rs 38,372 crore has been disbursed to the PSU banks while Rs 23,615 crore has been given to the private banks.