New Delhi | Jagran Business Desk: Finance Minister Nirmala Sitharaman on Thursday launched the Credit Guarantee Support Scheme for 27 stressed sectors due to the coronavirus pandemic and subsequent lockdown across the country, in the second set of the economic stimulus package. 

Addressing a press briefing, Finance Minister Nirmala Sitharaman said that credit guarantee scheme has been launched for 27 stressed sectors including the health care sector, as identified by the Kamath committee. The entities can utilise this scheme for 100 per cent guaranteed collateral-free additional credit at capped interest rates in these stressed sectors. 

The entities from these sectors with an outstanding credit of above Rs 50 crore and up to Rs 500 crore as of February 2, 2020, will be benefited in this scheme, she added. 

While announcing about the latest scheme, the finance minister said that the beneficiaries of this scheme will get an additional credit of up to 20 per cent of outstanding credit. She also said that the repayment of this credit can be done in five years' time (1 year of moratorium + 4 years of repayment). 

The finance minister further stated that the entities, who will be utilising the credit guarantee support scheme, will not have an upper ceiling on annual turnover, adding that tenor of the additional credit under this will be 5 years including a 1-year moratorium on principal repayment. The Credit Guarantee Support scheme will be available till March 31, 2020.

"The scheme will provide much-needed relief to the stressed sector by helping entities sustain employment and meet liabilities. This will also benefit the MSME sector which provides good and services to eligible entities," she added.

Nirmala Sitharaman also announced a new job creation scheme by giving subsidy to those establishments that make new hires. The subsidy would be to cover for retirement fund contributions by employees as well as employers for two years, she said. Employees contribution (12 per cent of wages) and employer's contribution (12 per cent of wages) totalling 24 per cent of wages would be given to establishments for two years, she added.

Earlier during her address, Nirmala Sitharaman said that the Indian economy is witnessing a strong recovery after a long and strict lockdown. Sitharaman said that the macro-economic indicators are pointing towards recovery.

Posted By: Talib Khan