The COVID-19 financial package announced by the Reserve Bank of India on Friday is too inadequate to manage the fiscal crisis as it would fetch only ₹729 crore for Kerala, Finance Minister T.M.Thomas Isaac has said.
Responding to the package, Dr. Isaac said that the package norms lack clarity and the only option left before the Centre to salvage the crisis is to raise the annual borrowing limit for States from the current 3% to 5%.
The announcement that States could avail themselves of loans up to 60% of the ways and means would fetch Kerala only ₹1,215 crore, but would have to repay it in 21 days.
The Centre does not seem to be aware of the gravity of the current crisis, Dr. Isaac said. He urged the RBI to direct banks to sanction additional loans to small and medium traders and such others who are forced to bear the brunt of the COVID-19 crisis. “The micro, small and medium enterprises as well as the traditional industries such as coir and cashew need support for reviving operations. Their loans should be restructured,” he added.
The Centre should announcer waiver of farm loans, extend the moratorium on all loans for a year and inglso waive the interest during the period. Similar to the sops announced for corporates, the Centre should adopt a liberal approach in the case of other sectors too, he said.
Dr.Isaac welcomed the packages announced NBFC, National Housing Bank, SIDBI, and NABARD.
