Economy witnessing strong recovery, says Finance Minister Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on Thursday said the Indian economy is witnessing a strong recovery after a long and strict lockdown.

Addressing a press conference to announce more stimulus measures to boost growth, she said macro-economic indicators are pointing towards recovery.

Track live updates of Nirmala Sitharaman's press conference here

She noted that Covid-19 active cases have declined from over 10 lakh to 4.89 lakh with case fatality rate (CFR) at 1.47 per cent, she said.

Giving out details of recovery, she said composite purchasing managers index (PMI) rose to 58.9 per cent in October versus 54.6 per cent in the previous month, registering strongest increase in output in close to nine years.

Energy consumption growth trended higher in October at 12 per cent year-on-year, while Goods and Services Tax (GST) collections have grown 10 per cent to over Rs 1.05 lakh crore.

Daily railway freight tonnage grew by an average 20 per cent year-on-year versus 12 per cent, she said adding bank credit has improved 5.1 per cent.

Also, foreign direct investment (FDI) inflows in April-August at USD 35.37 billion has seen a 13 per cent rise on a year-on-year basis.

RBI has predicted a strong likelihood of Indian economy returning to positive growth in Q3 2020-21, ahead by a quarter from the earlier forecast, she said adding prominent economists have suggested that the rebound is not only due to pent up demand but also due to strong economic growth.

Giving details of the progress made on the previous stimulus announcements under Aatmanirbhar Bharat Abhiyaan, Sitharaman said 28 states/union territories (UTs) have been brought under the national portability of ration cards with effect from September 1. This now covers 68.6 crore beneficiaries who now have an option to lift their food grains from any fair-price shops (FPS) of their choice in any of these 28 states/UTs, she said.

Intra-state portability is also enabled in these 28 states/UTs, she said adding 1.5 crore monthly transactions are happening. Under PM Street Vendor's AtmaNirbhar Nidhi, 26.62 lakh loan applications were received out of which 13.78 lakh loans totalling Rs 1,373.33 crore were sanctioned.

The Finance Minister said credit boost to 2.5 crore farmers has been achieved through Kisan Credit Cards (KCCs). "So far, 183.14 lakh applications have been received and have issued KCCs for 157.44 lakh eligible farmers and sanctioned a limit of Rs 1,43,262 crore in two phases," she said.

Under Pradhan Mantri Matsya Sampada Yojana (PMMSY), proposals worth Rs 1,682.32 crore from 21 states were sanctioned. As much as Rs 25,000 crore has been disbursed to farmers under the additional emergency working capital fund, she said. Sitharaman further said Rs 2.05 lakh crore was sanctioned to 61 lakh borrowers. Of this Rs 1.52 lakh crore has been disbursed.

As much as Rs 26,889 crore worth of portfolios have been bought by public sector banks (PSBs) under the partial credit guarantee scheme, she said adding Rs 7,227 crore was disbursed to Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs). She said Rs 1,18,272 crore worth of loans have been sanctioned to 17 states/UTs for liquidity injections in electricity distribution companies. Of this, 11 states have received Rs 31,136 crore.

The Finance Minister said Rs 25,000 crore has been provided as additional capital expenditure to the Ministry of Road Transport and Ministry of Defence. Also, 11 states have been sanctioned Rs 3,621 crore as interest free loan towards capital expenditure, she said. Further, Rs 1,32,800 crore of income tax refund has been made to 39.79 lakh assesses, she added.