The 16th Lhengye Zhungtshog (Cabinet Meeting) approved the Implementation Strategy of the Economic Stimulus Plan (ESP). The meeting was held yesterday.
A news release from the Cabinet Secretariat says as required by law, the government will be seeking the approval of Parliament to use the Economic Stimulus Plan fund during the next session of Parliament.
The release also said that the overall objective of the Economic Stimulus Plan is to re-invigorate the economy through Special Support Schemes (SSS), easing rupee situation and improving balance of payments, and by restarting loans.
The injection of funds would be done in the following areas:
1. SSS: Nu. 1,000 million (20%)
2. Debt: Nu. 2,100 million (42%)
3. Revolving fund I: Nu. 1,500 million (30%)
4. Revolving fund II: Nu. 400 million (8%)
According to the press release, the ESP will cover the formal lending sector, cottage and small industries and manufacturing and production, non-formal activities and SSS. The priority sectors would comprise of import substitution, earning forex and enhancing export potential, providing employment and expanding techno-commercial viability.
The revolving fund I, according to the release, would be targeting like cottage and small industries, manufacturing and production whereas the revolving fund II will be specified for non-formal activities, individuals and cooperatives, and rural enterprises.
Some of the SSS are: Higher Education Support Scheme; Senior Citizens Support Scheme; Guaranteed Employment Support Scheme.
The release also states that the ESP is expected to spur economic growth, which will generate employment, enhance productive capacity and improve balance of payment situation. “To maintain the momentum of ESP activities and to ensure long-term sustainability, fiscal and monetary measures and other back stopping support will accompany the ESP.”
The government so far has received 1 billion Rupees out of 5 billion committed by Government of India for the Economic Stimulus Plan.
The Cabinet has decided that the ESP budget would be allocated and used with the consent of the ESP Task Force.
The ESP Taskforce is co-chaired by Joint Secretaries of the Ministry of Finance and the Ministry of Economic Affairs.
