No new schemes for a year, says finance ministry amid rising Covid-19 cases
The remainder of this year will see no new schemes, announced the finance ministry on Friday, a move aimed at tightening the spending even as the country is witnessing an uptick in coronavirus cases.
The ministry said only the ones sanctioned and announced under the Atmanirbhar Bharat Abhiyan and other special packages will be attended to. The schemes already approved under the Budget will also stay suspended till March 31.
“In-principle approval for such schemes will not be given this financial year. Initiation of new schemes already appraised/approved will remain suspended for one year till march 31, 2021,” read a statement by the finance ministry.
Fighting the falling revenues due to a long-drawn out lockdown, necessitated by the coronavirus epidemic, various state governments too have put a freeze on spending.
Amid calls for support, the Centre did announce Rs 20 lakh crore financial stimulus package to give more money into people’s hands and to push spending.
India’s economic growth slipped to 3.1 per cent in the January-March quarter of 2019-20 showing impact of Covid-19 pandemic. The gross domestic product (GDP) had expanded by 5.7 per cent in the corresponding quarter of 2018-19. In 2019-20, the Indian economy grew by 4.2 per cent against 6.1 per cent expansion in 2018-19.
On May 22, Reserve Bank of India (RBI) governor Shaktikanta Das said the Covid-19 pandemic will likely lead to a contraction in India GDP in the financial year 2020-21. Just about a month ago, the International Monetary Fund had projected India’s GDP growth in the year to be 1.9%. Private forecasters have been projecting a contraction for some time.