FInance Minister Nirmala Sitharaman addressing a press conference in New Delhi on May 14, 2020.
FInance Minister Nirmala Sitharaman addressing a press conference in New Delhi on May 14, 2020.

Govt moves to help migrant workers with free food grains for two months, ration card portability

New Delhi, May 14, 2020

The Government today announced a slew of measures, including free food grain supply for two months, to help migrant workers who have been hit very badly by the lockdown imposed by the Government to contain the spread of the coronavirus (COVID-19) pandemic since March 25.

The measures for the poor, including migrant workers, farmers, street vendors and tiny businesses, were part of the second set of steps unveiled by Union Finance Minister Nirmala Sitharaman at a press conference here. They are part of the Rs 20 lakh crore special economic package announced by Prime Minister Narendra Modi in his address to the nation on May 12. The first set of measures were announced by Sitharaman yesterday and more details are expected to be given out in the next few days.

Pointing out that migrant workers need food grain assistance, Sitharaman said those who are neither National Food Security Act (NFSA) or State Card beneficiaries in the state they are stationed in would be provided 5 kg of grains per person and 1 kg chana per family per month for two months.

About 8 crore migrants are expected to benefit from this decision on which the estimated expenditure would be Rs 3,500 crore, which will be fully borne by the Government of India. State Governments will be responsible for implementation, identification of migrants and full distribution and providing detailed guidelines.

Sitharaman also announced that technology systems would be used to enable migrants to access the Public Distribution System (PDS) from any fair price shop in India by March 2021 under the One Nation One Ration Card scheme.

"This scheme will enable a migrant beneficiary to access the Public Distribution System from any fair price shop in the country," she said.

According to her, 67 crore beneficiaries in 23 states, covering 83% of PDS population, will be covered by national portability of ration cards by August, 2020 and 100% national portability will be achieved by March, 2021.

She said all the States and Union Territories would complete full FPS automation by March, 2021.

Referring to the challenges that migrant workers and the urban poor face in getting houses at affordable rent, Sitharaman said the Government would launch a scheme under the Pradhan Mantri Awas Yojana (PMAY) to address this issue.

This would be done by convering government-funded housing in the cities into Affordable Rental Housing Complexes (ARHC) under PPP mode through concessionaire; incentivizing manufacturing units, industries, institutions, associations to develop ARHCs on their private land and operate them ; and incentivizing State Government Agencies / Central Government Organizations on similar lines to develop ARHCs and operate them. Detailed guidlines will be issued in this regard soon.

The Finance Minister also announced a Rs 1,500 crore Interest Subvention Scheme for MUDRA-Shishu Loans, pointing out that small businesses under MUDRA had been disrupted the most by the lockdown and it had also impacted their capacity to pay their EMIs.

A loan moratorium has already been announced by the Reserve Bank of India, she said.

The current portfolio of MUDRA-Shishu loans is about Rs 1.62 lakh crore (with a maximum loan amount of Rs 50,000).

She said the Government of India would provide interest subvention of 2% for prompt payees for a period of 12 months, which will work out to a relief of Rs 1,500 crore for MUDRA-Shishu loanees.

Sitharaman also announced a Rs 5,000 crore Special Credit Facility for Street Vendors, who have seen an adverse impact on their livelihood due to COVID-19.

She said the Government would launch a special scheme within a month to facilitate easy access to credit for street vendors, providing them with an initial working capital up to Rs 10,000.

Digital payments will be incentivized through monetary rewards and enhanced working capital credit would be made available for good repayment behaviour.

The scheme would support nearly 50 lakh street vendors around the country and provide liquidity of Rs 5,000 crore, she said.

Sitharaman said the Government would also facilitate investment of more than Rs 70,000 crore and creation of jobs in the housing sector through extension of the Credit Linked Subsidy Scheme (CLSS) for Middle Income Group (annual income of Rs 6-18 lakh), which was operationalised from May, 2017. The CLSS was extended up to March 31, 2020.

The Minister said the scheme would now be extended up to March, 2020, which would benefit 2.5 lakh middle income families during 2020-21.

The decision is also expected to stimulate demand for steel, cement, transport and other construction materials.

Sitharaman announced plans for a Rs 6,000 crore-employment push, using funds under the Compensatory Afforestation Management & Planning Authority (CAMPA) set up under the Compensatory Afforestation Fund Act, 2016.

She said plans worth Rs 6,000 crore would be approved shortly and the funds are to be used by State Governments for afforestation and plantation works, including in urban areas; artificial regeneration, assisted natural regeneration; forest management, soil & moisture conservation works; forest protection, forest and wildlife related infrastructure development, wildlife protection and management, and so on.

The move will create job opportunities in urban, semi-urban and rural areas for tribals and Adivasis, she said.

The Minister also announced Rs 30,000 crore of Additional Emergency Working Capital Funding for farmers through NABARD, pointing out that there were inadequate financial resources with small and marginal farmer and Regional Rural Banks (RRBs) and rural cooperative banks for their main source of credit.

She said NABARD would extend additional refinance support of Rs. 30,000 crore for crop loan requirement of Rural Co-op Banks and RRBs. This wil be over and above the Rs 90,000 crore to be provided by NABARD through the normal refinance route during this year.

The front-loaded on-tap facility will be available to 33 State Co-operative banks, 351 District Co-operative banks and 43 RRBs based on their lending. This will benefit around 3 crore farmers, mostly small and marginal farmers and help meet the post-harvest (Rabi) and current Kharif requirement in May/June, she said.

Sitharaman also announced a Rs 2 lakh crore concessional credit boost to 2.5 crore farmers through Kisan Credit Cards. She said a special drive would be undertaken tin this regard and fishermen and animal husbandry farmers would also be included in it.

"This will enable such farmers to gain access to institutional credit at concessional interest rate. About 2.5 crore farmers will be covered and will benefit from credit flow of about Rs 2 lakh crore," she added.

Sitharaman began by recalling the various measures of direct suppor to farmers and the rural economy provided by the Government through earlier decisions in the wake of the COVID crisis.

These include agricultural loans of Rs 4.22 lakh crore, interest subvention schemes, new Kisan Credit Cards loan limit of Rs. 25,000 crore, and so on.

She also referrred to decisions taken to provide support for migrant workers and urban poor in the last two months, including shelter and meals. She said States and UTs have been advised to provide work to returning migrant workers.


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