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Business News/ News / India/  Centre announces 10,000 cr boost for rural economy

Centre announces ₹10,000 cr boost for rural economy

FM Sitharaman said the money is to be funnelled via the Garib Kalyan Rojgar Yojana

Union finance Minister Nirmala Sitharaman. (PTI)Premium
Union finance Minister Nirmala Sitharaman. (PTI)

Union finance Minister Nirmala Sitharaman on Thursday announced an additional 10,000 crore to boost rural employment and accelerate growth in the rural economy.

The 10,000 crore is to be funnelled into the rural sector through the Pradhan Mantri Garib Kalyan Rojgar Yojana, the minister said. The money is expected to be used for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) and the Pradhan Mantri Gram Sadak Yojna.

The finance minister had in May announced an extra 40,000 crore for MGNREGS as part of the 20 trillion covid-19 relief package. This was in addition to the 61,5000 crore announced by Sitharaman in the budget in February and thus the total outlay is more than 1 trillion.

In June, the Modi government had announced projects worth 50,000 crore to be implemented in 116 districts of six states under the Garib Kalyan Rojgar Abhiyaan, an employment and rural public works campaign to provide livelihood opportunities in villages that saw the return of a large number of migrant workers affected by covid-19.

MGNREGS is seen to have helped reduce rural distress during lockdown following the coronavirus outbreak, which had led to migrants going home to their villages in the wake of the closure of factories and businesses.

The finance minister said 73,504 crore had been released to states under MGNREGS, resulting in the creation of 2.51 billion person-days of employment. “This will accelerate growth of the rural economy," she said.

The announcement has brought the total allocation for the rural sector to 1.6 trillion, which analysts hailed. “It is good that the finance minister is promising more money," said Himanshu, associate professor at Jawaharlal Nehru University and visiting fellow at the Centre de Sciences Humaines, New Delhi. “However, the government should focus on increasing the pace of spending under this programme," he added. States had spent all the money released to them and there were only a few more months left in this calendar year, he pointed out.

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Published: 13 Nov 2020, 08:56 AM IST
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