Prime Minister Narendra Modi has announced sops of farmers, small entrepreneurs and women. Addressing the Nation on the completion of 50 days of demonetization — announced on November 8, 2016 â€“ Prime Minister said the Government has taken some major decisions to ensure homes for the poor, the neo middle class and the middle class.
Two new middle income categories have been created under the Pradhan Mantri Awaas Yojana in urban areas. Loans of up to 9 lakh rupees taken in 2017, will receive interest subvention of 4 per cent. Loans of up to 12 lakh rupees taken in 2017, will receive interest subvention of 3 per cent.
The number of houses being built for the poor, under the Pradhan Mantri Awaas Yojana in rural areas, is being increased by 33 per cent. Another scheme has been put in place for the neo middle and middle class in rural areas. Loans of up to 2 lakh rupees taken in 2017, for new housing, or extension of housing in rural areas, will receive an interest subvention of 3 per cent.
“”In the last few weeks, an impression was sought to be created that the agriculture sector has been destroyed. Farmers themselves have given a fitting reply to those who were doing so. Rabi sowing is up by 6 per cent compared to last year. Fertilizer offtake is up by 9 per cent. During this period, the Government has taken care to ensure that farmers do not suffer for want of access to seeds, fertilisers and credit. Now, we have taken some more decisions in the interest of farmers.
Farmers who have taken loans for the Rabi crop from District Cooperative Central Banks and Primary Societies, will not have to pay interest on such loans for a period of 60 days. Farmers who have paid interest during the last two months, will receive these amounts back, directly into their bank accounts,â€™â€™ he said.
Arrangements are being made to provide farmers even better access to loans from cooperative banks and societies. NABARD created a fund of 21,000 crore rupees last month. Now, Government is adding 20,000 crore rupees more to this. The loss that NABARD suffers by giving loans to cooperative banks and societies at low interest rates, shall be borne by the Government, Mr Modi said.
The Government has decided, that 3 crore farmers who have Kisan Credit Cards, will be given RuPay debit cards within three months. Kisan Credit Cards were launched in 1998, but so far, it was essential to go to a bank, to use them. Now, farmers will have RuPay Debit Cards, which they can use anywhere.
Just as agriculture is vital for the economy, so are the medium and small scale enterprises also called the MSME sector. Government has taken some decisions in the interest of small and medium businesses, which will also boost employment, Mr Modi said.
“Government of India underwrites loans given by banks to small businesses through a trust. So far, loans were covered upto one crore rupees. This limit is now being enhanced to 2 crore rupees. Earlier the scheme only covered bank loans. Hereafter it will cover loans given by NBFCs as well. This decision will enable better access to credit for small shop-owners and small enterprises. Banks and NBFCs will not levy high interest on these loans, as Government of India is bearing the cost of underwriting them,â€™â€™ he added.
Government has also asked banks to raise the credit limit for small industry from 20 per cent of turnover to 25 per cent. Banks have also been asked to increase working capital loans from 20 per cent of turnover to 30 per cent, for enterprises that transact digitally. Many people connected with this sector have made cash deposits in the last few weeks. Banks have been asked to take this into account when deciding on working capital, he said.
A few days back, Government announced a major tax relief for small businesses. Income of businesses with turnover of up to Rs 2 crores was calculated at 8% of the turnover. Now, for such businesses income from digital transactions will be calculated at 6%. This will effectively reduce their tax liability by 25%.
The progress of the MUDRA Yojana has been very encouraging. Last year, nearly 3 and a half crore people have benefited from this. The Government now aims to double this, giving priority to Dalits, Tribals, Backward Classes and Women. “We are introducing a nation-wide scheme for financial assistance to pregnant women. 6000 rupees will be transferred directly to the bank accounts of pregnant women who undergo institutional delivery and vaccinate their children. This scheme will help reduce the maternal mortality rate, in a big way. This will help ensure nutrition before and after delivery, and improve the health of mother and child. So far, pregnant women in 53 districts were being given financial assistance of 4000 rupees, under a pilot project.
We are initiating a scheme for senior citizens. Banks often reduce their deposit rates, when they receive a large volume of money. This should not adversely impact senior citizens. Under the scheme, senior citizens will receive a fixed interest rate of 8 per cent for a period of 10 years, on deposits upto 7.5 lakh rupees. The interest will be paid monthly,â€™â€™ he said.
“We have, during the external aggressions, of 1962, 1965, 1971 and Kargil; witnessed the intrinsic strength of our citizens. Such collective energy and patriotism is understandable, in the face of external threats. However, when crores of Indians unite to fight a war against internal evils, it is unparalleled,â€™â€™ he said.
Indians have displayed the strength of people power, utmost discipline, and the ability to discern the truth in a storm of disinformation. They have shown that resolute honesty, can defeat dishonesty. “It is historic, that both the people and the government are on the same side in this battle against evil. The Government is well aware, that in this period, you had to queue up, and face difficulty in withdrawing your own money,â€™â€™ Mr Modi said.
“”`My effort is to take the banking system to normalcy as fast as possible in the new year. I have asked all concerned officers in the Government to focus their attention to this task. They have especially been told to proactively resolve the problems in rural and remote areas,”” he said.
There is no precedent globally, to what India has done. Nations similar to us do not have the amount of currency that we had. Over the last ten to twelve years, 500 and 1000 rupee currency notes were used less for legitimate transactions, and more for a parallel economy. The excess of cash was fuelling inflation and black-marketing. It was denying the poor, their due. Lack of cash causes difficulty, but excess of cash is even more troublesome. Our aim is to achieve a balance. Economists agree that when cash is outside the formal economy, it is a cause of worry. When it joins the mainstream, it is an opportunity for development, he explained.
Linking unrest and unlawful activities with black money, Mr Modi said it is accepted the world over, that terrorism, Naxalism, Maoism, counterfeit currency trade, drug trade, human trafficking â€“ all of these depend on black money.
Pointing out that demonetistion has dealt a severe blow to these trades, Prime Minister said youth who had turned to the wrong path, are returning to the mainstream in large numbers. “If we remain vigilant, we can now save our children from returning to those evil ways of violence and cruelty. The fact that so much of the cash in circulation has been deposited in the banking system indicates the success of this mission,â€™â€™ he added.
Appreciating efforts of bank employees during this Herculean effort, Mr Modi said some grave crimes by some officers in some banks have come to light. Some Government officers have also committed serious offences, and tried to take advantage of the situation. They will not be spared, he warned. “”History is witness that the Indian banking system has never received such a large amount of money, in such a short time. While respecting the autonomy of the banks, I appeal to them to move beyond their traditional priorities, and keep the poor, the lower middle class, and the middle class at the focus of their activities,â€™â€™ Prime Minister said.
Political parties, political leaders and electoral funding, figure prominently in any debate on corruption and black money. The time has now come that all political leaders and parties respect the feelings of the nationâ€™s honest citizens, and understand the anger of the people. It is true that from time to time, political parties have made constructive efforts to improve the system.
“”I urge all parties and leaders to move away from a â€œholier than thou approach,”” to come together in prioritising transparency, and take firm steps to free politics of black money and corruption. This is to break the endless cycle of elections, reduce election expenditure, and minimize pressure on the administrative machinery,â€™â€™ Mr Modi said.”