Union Finance Minister Nirmala Sitharaman has said the government will make sure banks will extend credit to small businesses, which will indirectly help poor, middle class and migrants. She said the government, among other suggestions, had received feedback to consider making larger cash transfers to alleviate stress among poor and those affected. However, the Centre decided to do it by way of asking banks to first reach out to small units without additional collateral, which she said was aimed at putting money in people's hands.
"I am not objecting to this suggestion. I repeat my answer, yes it was a suggestion we have heard, we have taken that into account, we have thought about it and in a way by extending the banks to reach out first without additional collateral for every small unit, let them refuse (to take) it but you approach to give, automatic is the word I use, what is that aimed at?" she said during an interview with The Indian Express.
Sitharaman said the stimulus package would make sure smaller units meet their fixed costs and pay wages to their workers, which would help most migrants. "So that's what we have done. I have made sure that banks will extend. Yes it's a loan, it's a credit, yes, it's not a grant. But that's where I am asking, grants for how many, of how much?" she added.
Sitharaman also said the economic stimulus was a "responsible package" and that it will put "public money" directly in poor and middle-class' hands. She said the measures announced in the fiscal stimulus will provide re-employment and that every sector would benefit from it.
Prime Minister Narendra Modi on May 12 announced the stimulus, saying it was aimed at making India a "self-reliant nation". The fiscal stimulus worth Rs 20 lakh crore announced has received criticism from several quarters. The package was 10 per cent of India's GDP, placing India among countries like the United States, Japan and Germany, which had announced mega stimulus packages to revive their pandemic-ravaged economies. However, critics have said it focussed on long-term measures rather than addressing pressing issues arising out the coronavirus pandemic-induced lockdown in India.