The third tranche (Atmanirbhar Bharat 3.0) of the stimulus package announced by the Finance Minister Nirmala Sitharaman on Thursday will cost the government close to Rs 1.30 lakh crore more in the current financial year. Overall, the total fiscal cost of these announcements could be around Rs 2.47 lakh crore over the next five years.
FM Sitharaman announced a slew of fiscal measures including additional outlay for fertilisers subisidies, Pradhan Mantri Awas Yojana and urban and rural employment schemes.
The biggest chunk of the Rs 1.30 lakh crore package announced today goes for fertiliser subsidy. FM Sitharaman has announced an additional Rs 65,000 crore as fertiliser subsidy for the current year (2020-21) over and above the budgeted outlay of Rs 71,300 crore. With this the total allocation for fertiliser subsidy will exceed Rs 1.36 lakh crore.
The Performance Linked Incentive (PLI) scheme extended to 10 manufacturing sectors, totaling about Rs 1.46 lakh crore for five years that was announced yesterday was clubbed among today's announcements. If only one-fifth of the amount is spent this year, the total outgo for the government could be Rs 29,000 crore in the current financial year.
An additional outlay of Rs 10,000 crore will be provided for rural employment generation through allocation to PMNREGS and PM Garib Sadak Yojana in the current financial year. The government has already increased the allocation of PMNREGS by Rs 40,000 crore to Rs 1.01 lakh crore in the current financial year. The additional Rs 10,000 crore would take that amount to Rs 1.11 lakh crore.
To further boost spending in infrastructure and industrial projects, an additional amount of Rs 10,200 crore has been provided towards capital and industrial expenditure.
To incentivise employment generation, the government will provide subsidy for two years to EPFO-registered establishments if they provide new employment on or after October 1, 2020. The subsidy will be in terms of the government bearing the 12 per cent contribution each by employees and employer towards EPFO for establishments employing up to 1,000 employees, and 12 per cent of the employee contribution for establishments employing more than 1,000 employees. This will cost the government an additional Rs 6,000 crore over the two years.
The government will infuse Rs 6,000 crore equity in the NIIF debt platform, while Rs 3,000 crore will be released to EXIM Bank for promotion of project exports through Lines of Credit under IDEAS scheme. A sum of Rs 900 crore has been provided as R&D grant for development of COVID-19 vaccines.
Around Rs 18,000 crore additional funds will be provided for Pradhan Mantri Awas Yojana - Urban (PMAY-U) through additional allocation and Extra Budgetary Resources. So, this amount would not directly be shown in government books. This additional amount is over and above Rs 8,000 crore already provided in the budget this year.
So far the government has announced a total stimulus of Rs 29.87 lakh crore, of which Rs 12.71 lakh crore has been in form of liquidity infusion measures by the Reserve Bank of India.