Centre unveils Rs 1.7 lakh crore scheme to help the poor amid lockdown

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Centre unveils Rs 1.7 lakh crore scheme to help the poor amid lockdown

In what comes as a relief to the poor, Finance Minister Nirmala Sitharaman announced a slew of measures to help tide over the economic fallout of the COVID-19 pandemic. FM Nirmala Sitharaman unveiled a new scheme called the Prime Minister Garib Kalyan Yojana worth Rs 1.7 lakh crore. The economic package includes measures for direct cash transfers to various sections of society, free LPG gas cylinders to poor households, insurance for frontline workers and several other measures.

The FM announced that frontline workers including doctors, paramedical staff, ASHA workers, and sanitation workers will get an insurance cover of Rs 50 lakh per head. All the announcements made are expected to be rolled out immediately.

Here is a list of the announcements made by the minister under the Prime Minister Garib Kalyan Yojana:


Eighty crore poor people will get 5 kg rice or wheat for three months for free. This is over and above the 5 kg they already get from the public distribution system (PDS). The government has said that it will bear the entire expenditure of Rs 40,000 crore for this. In addition, they will also get 1 kg of pulses of their choice for free. 

Cash transfer announcement

> For farmers, FM Nirmala announced that the first installment of PM Kisan Yojana – an existing scheme – will be paid in advance in the month of April. This means that 8.69 crore farmers will get Rs 2,000 in April. The government of India will spend Rs 16,000 crore on this. 

> Under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA), which provides employment to people in rural areas for 100 to 150 days in a year, the FM announced a wage increase of Rs 20 per work day per worker. This will result in workers getting an additional income of Rs 2,000 (per year) under the scheme, the FM said. The wage rate has been increased from Rs 182 to Rs 202. This is expected to benefit 5 crore families. The government will be spending approximately Rs 5,600 crore for this.

> For poor widows, senior citizens and persons with disabilities, the government has announced an ex-gratia (one time) amount of Rs 1,000 in 2 installments over the next three months. This is expected to benefit 3 crore people. Rs 3,000 crore has been allocated for the same. 

> For 20 crore women who have bank accounts under the existing Jan Dhan Yojana, the minister announced an ex gratia amount of Rs 500 per month for the next three months to run household affairs. For this, the government will be spending Rs 31,000 crore. 

> For women who got gas cylinders under the Ujjwala scheme, the government has announced free cylinders for the next three months. This is expected to benefit 8.3 crore Below Poverty Line (BPL) families. Rs 13,000 crore will be allocated for this. 

> For women who are part of Self Help Groups (SHGs), the government is doubling the collateral-free loans given under Deen Dayal Yojana to Rs 20 lakh. This is expected to benefit 7 crore households through 63 lakh SHGs.

Organised sector workers

> The Union government will pay the Employee Provident Fund (EPF) contribution of both the employer and employee (12% each) for the next three months so that nobody suffers because of loss of continuity of EPF. This for companies which have up to 100 employees, and 90% of who draw less than Rs 15k per month. Rs 5,000 crore will be spent by the government for this.

> In continuation, the provident fund scheme regulations will be amended to allow non-refundable advance of 75% of the amount standing to the credit of a member, or 3 months of wages, whichever is lower. This is expected to impact 4.8 crore registered with EPF

For construction workers

By a central government Act, there is a welfare fund of Rs 31,000 crore for building and other construction workers, which has 3.5 crore registered workers. The FM said that the government intends to give directions to state governments to provide assistance to protect construction workers against any economic disruption.

District Mineral Fund

The FM also said that the Centre will request the state governments to use funds for supplementing and augmenting all medical testing activities, screening activities and other requirements necessary to find and prevent spread of coronavirus.