Before the festive season, the central government has made several important announcements today to increase the demand in the economy. Finance Minister Nirmala Sitharaman said in a press conference today that several steps are being taken to increase the demand in the economy. The government has brought cash vouchers and festival advance scheme. Under this, the central government will give Rs 10,000 in advance to all its employees for accelerating the economy. These rupees will be given as festival advance. This move of the government will provide additional money for about one crore central employees to spend on the festival.
The government will give cash to its employees instead of LTC ticket fair for buying goods with 12% or more GST. The Central Government will spend 5675 crores on this. Apart from this, PSUs and banks will spend 1900 crores rupees under this head. Finance Minister says that this will bring 19 thousand crore rupees to the economy. If the states also take steps in this direction, then 9 thousand crore rupees and additional will come in the market. He said that if the private sector also gave relief to its employees, the total demand in the economy could cross Rs 1 lakh crore.
To accelerate the economic activity, the central government will give an interest-free loan of 12 thousand crore rupees to the states. This loan can be refunded in 50 years.
Vouchers given to LTC in place of LTC will have to be spent by 31 March 2021. Vouchers instead of LTC will allow employees to make digital purchases.
The central government will provide an additional 25 thousand crore rupees for roads, defence infra, water supply and urban development. In the budget, Rs 4.31 lakh crore was allocated for these sectors.
Festival advance will be able to return in 10 instalments
The festive advance was in place till the 6th Finance Commission. Under this, Rs 4,500 was paid to the employees. It was for non-gazetted. The Seventh Commission did not have its arrangement, but now it is being revived for a single time. Now it will apply to all. Under this, all employees of the central government will be given Rs 10,000. Employees can return it in 10 instalments.
It will have to be spent by 31 March 2021. It will be given as a prepaid rupee card of Rs 10,000. It will be interest-free. It can be spent anywhere. Four thousand five hundred crore rupees will be spent on central government employees under this scheme. If the state government also implements this scheme, then an additional burden of Rs 8,000 crore will be incurred.