CCEA has cleared a proposal that involves a total of Rs 1,340-crore capital infusion into regional rural banks (RRBs) in FY21 to bolster their ability to lend.
The Cabinet Committee on Economic Affairs (CCEA) on Wednesday cleared a proposal that involves a total of Rs 1,340-crore capital infusion into regional rural banks (RRBs) in FY21 to bolster their ability to lend at a time when the Covid-19 pandemic has threatened to exacerbate an already-faltering credit flow.
The Centre’s share in this infusion will be Rs 670 crore, while the rest will come from sponsor banks of these RRBs.
The Cabinet approved the extension of the scheme for the Rebate of State and Central Taxes and Levies for garment and made-up exports beyond March 31 until a proposed WTO-compatible scheme — Remission of Duties and Taxes on Exported Products (RoDTEP) — is implemented later next fiscal.
Garment exports have witnessed a roller-coaster ride in recent years, despite the announcement of a Rs 6,000-crore package in 2016, as the labour-intensive sector was hit by demonetisation and the GST in quick succession. In the April-January period of this fiscal, while exports of cotton garments rose just 4.4% year-on-year, those of man-made fibres dropped by 3.9%.
The Cabinet gave its nod to the construction of the Aligarh-Harduaganj railway flyover with a total length of 22 km. It is likely to be completed in five years, information and broadcasting minister Prakash Javadekar said after the meeting.
Regional rural banks are mandated to extend 75% of their total credit under priority sector lending (PSL) provisions to sectors. They play a critical role in addressing the credit requirements of the agriculture sector and MSMEs, with a focus on small and marginal farmers, among others.
Already, the government has initiated structural consolidation of regional rural banks in three phases, thereby reducing their number from 196 in 2005 to 45 now, in a bid to enhance their efficiency and strength.
Commenting on relief to the poor in times of a country-wide lockdown, Javadekar said they are being provided highly subsidised grains and that the government is sensitive to their concerns.
To cope with potential demand for higher quantities of grain in the wake of a lockdown, the government had on Monday announced the supply of grain to states for three months on credit from the Food Corporation of India.
Separately, the finance ministry also announced that there won’t be any pay cut for contractual workers employed with Central government ministries and departments if they don’t come to work due to the spread of coronavirus.