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Centre announced an additional outlay of  ₹10,000 crore for the PM Garib Kalyan Rozgar Yojana for FY21. (Photo: Hindustan Times)
Centre announced an additional outlay of 10,000 crore for the PM Garib Kalyan Rozgar Yojana for FY21. (Photo: Hindustan Times)

With an eye on key support base, NDA announces package for employment incentive, rural infra and housing

  • The steps taken to generate jobs, improve infra and housing in villages would enthuse BJP’s vote bank
  • The announcement comes just two days after Bihar elections where the BJP-led NDA retained power

The Union government on Thursday announced a series of steps to generate employment, help farmers, improve rural infrastructure and housing for the financially weaker sections—all key social sector reforms that would enthuse the ruling Bharatiya Janata Party (BJP)’s voter base.

The announcement comes just two days after the Bihar elections where the BJP-led National Democratic Alliance (NDA) fought anti-incumbency to retain power, despite facing the anger of migrant labourers and others who are suffering due to a slowing economy.

“The size of the stimulus being provided by the government, as part of the 12 announcements made today under Aatmanirbhar Bharat 3.0, amounts to 2.65 trillion, 15% of the national GDP (gross domestic product) as stimulus takeaway," said finance minister Nirmala Sitharaman.

With over three million migrant labourers returning to their villages in Bihar and an equal number to Uttar Pradesh, besides scores to Madhya Pradesh, West Bengal and Jharkhand, the Centre has also announced an additional outlay of 10,000 crore for the PM Garib Kalyan Rojgar Yojana for FY21 to boost rural employment. Over seven million migrant labourers who had returned to their homes during the nationwide lockdown belonged to just five states.

The Union government also decided to incentivise job creation opportunities during the covid-19 recovery. “Every EPFO-registered organization, if they take in new employees or those who had lost jobs between 1 March to 30 September, these employees will get benefits," said Sitharaman.

Continuing its focus on providing housing for the poor, the government announced 18,000 crore, which will be provided over and above the budget estimate for 2020-21 under the Pradhan Mantri Awas Yojana, particularly for urban India. Providing houses to urban and rural poor was part of Prime Minister Narendra Modi’s election promise.

“This extra budgetary resource will help 1.2 million houses to be grounded and 1.8 million houses will get completed," Sitharaman said. To further boost agricultural activity and help farmers, the Centre set aside 65,000 crore to ensure adequate availability of fertilisers for the rabi season.

However, the Congress hit out at the Centre, alleging that the announcements were meant to gloss over the current “dire straits" of the economy that hurt the financially weaker sections the most.

“The announcements made today are very lofty. We will soon get to know what will be its impact on the industry, businesses, especially on the MSMEs. But this was an effort made by the finance minister to suppress the recent analysis of the Reserve Bank of India about this year, which talked about economic scepticism and recession. Therefore, a huge Diwali Dhamaka ‘Aatmanirbhar Package 3.0’ was put in front of the public," former Union minister Jairam Ramesh told reporters.

Earlier in the day, former Congress chief Rahul Gandhi tweeted: “India has entered into recession for the first time in history. Mr Modi’s actions have turned India’s strength into its weakness." His statement led to a sharp response from the BJP with Union minister Anurag Thakur saying Gandhi should focus on putting his house in order and focus on electoral performance.

CARE ratings on Thursday said the stimulus could have an impact of 0.25-0.6% of GDP on fiscal deficit. “The announcements to further support the economy in its recovery phase are a step in the right direction. The measures will help in boosting employment generation, provide additional credit to the stressed sectors, multiplier effects on undertaking additional capital expenditure and spending for the real estate sector and more spending towards the rural economy," it added.

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