Economy

Modi's New Year gift

K.R. Srivats New Delhi | Updated on January 16, 2018

modi-demonisation









* Woos farmers, small traders, women, senior citizens with slew of sops



* also announces interest concession to urban housing loans for lower middle class



* Directs officials to restore 'normalcy' in banks at the earliest



Assuring the nation that banking operations will return to 'normalcy' at the earliest, Prime Minister Narendra Modi on Saturday rolled out several measures to soften the blow of demonetisation on farmers, low income groups, women and senior citizens.



In his new year eve address to the nation--at the end of the 50 day demonetisation period--Modi also announced new home loan interest concession for those aspiring to own homes in urban areas under Pradhan Mantri Awas Yojana (PMAY).



Two new schemes under PMAY have been announced--Those availing loans upto Rs 9 lakh for buying homes in 2017 will get interest concession (subventions) of 4 percent. In the case of loans up to Rs 12 lakhs, interest concession (subventions) of 3 percent will be provided.



Number of houses to be built in rural areas under PMAY is to be increased by 33 percent. Also, a concessional loan of up to Rs 2 lakhs for making home improvements and expansion in rural areas will be provided.



Modi also said that in the next three months as many as three crore Kisan credit cards will be converted into RUPAY credit cards. This will enable the farmer to use these RUPAY credit cards everywhere and not only in banks.



Modi also announced the inclusion of non banking finance companies (NBFCs) under the credit guarantee scheme (CGTSME) for lending to small and medium enterprises.



He said that the priority of the government is to protect the common man, help the honest and isolate the dishonest.



Modi also said that he has directed government officials to quickly resolve the farmers' problems in rural and far-flung areas.

Appeal to banks

Modi appealed to banks in the country to work for the benefit of the poor and low income households and not let this opportunity (huge deposit flow into banks due to demonetisation) go.

For small entrepreneurs, Modi announced that credit guarantee will be raised from Rs 1 crore to Rs 2 crore.

For small businesses, cash credit limit has been raised to 25 per cent from 20 percent.

Also, senior citizens will be assured 8 percent interest on their deposits up to Rs 7.5 lakhs.





Srivats.kr@thehindu.co.in

Published on December 31, 2016

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