Coronavirus aftermath: Govt's Rs 1.7 trillion bounty to back poor and needy via cash transfer, food scheme

The Centre, through the Pradhan Mantri Gareeb Kalyan Yojana PMGKY), has reached out to the “most vulnerable sections” with a Rs 1.7 lakh crore package that would extend for three months, far beyond the notified lockdown period of 21 days. Finance minister Nirmala Sitharaman said over 80 crore of the most vulnerable in the country, two-thirds of the country's population, will stand to benefit.

This includes a Rs 50 lakh medical insurance cover for all health workers, right from doctors and nurses to paramedical staff and Asha workers, and additional free food grains to the BPL category and a slew of cash benefits to farmers, senior citizens, widows, differently-abled and poor women to tide over the sudden social and economic disruption of the 21-day lockdown.

Rs 50 lakh medical insurance

Announcing the Rs 50 lakh medical insurance cover, here is what finance minister Nirmala Sitharaman said about health workers: “All of them are putting themselves under tremendous risk, not having the time nor the inclination to worry about their health.” The health insurance cover is expected to benefit 20 lakh people in the vanguard of the fight against the surging novel coronavirus.

No hungry stomach

There will be food and cash components to the PM Gareeb Kalyan Yojana.

“We want to make sure that not a single poor person in the country remains without food," the finance minister said. She said under the PM Gareeb Kalyan Anna Yojana 80 crore poor people, two-thirds of our population, would be assured adequate food. As per existing norms, each BPL family will get 5 kg of rice or wheat free.

The finance minister announced an additional 5 kg of free rice or wheat for these families for the next three months. Besides, these families will also be given one kg of pulse, of whichever variety is the most preferred in a particular area.

The finance minister said these food entitlements could be lifted by the BPL families in two instalments.

She then announced a series of cash benefits for eight sections of the population.


They are already entitled to receive Rs 6000 annually from the PM Kisan Samman Nidhi. “The first installment of this, Rs 2000 per farmer, will now be frontloaded and shifted to their bank accounts immediately,” the finance minister said. The measure is expected to benefit 8.9 crore farmers.

MGNREGA workers

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Mahatma Gandhi Rural Employment Guarantee Scheme workers will get a wage increase. Daily wage would go up from the existing Rs 182 to Rs 202. This will provide MGNREGS workers an additional Rs 2000 every month. According to the finance minister, this will benefit 5 crore families. the finance minister also hinted that the wage increase will continue even after the lockdown period.

Senior citizens, widows and disabled

They will get an ex gratia payment, a one-time transfer of Rs 1000, which they will get in three installments in the coming three months. This is expected to benefit three crore people.

Women Jan Dhan account holders

Rs 500 will be transferred to their accounts every month for the next three months. “They can now use this money to run the affairs of their household without wondering from where the money is going to come,” the finance minister said. As many as 20 crore women are expected to benefit.

Ujjwala beneficiaries

It was under the PM Ujjwala Yojana that 8 crore poor women who were using firewood were provided LPG connections. Under the scheme, the Centre provided financial support of Rs 1600 for each LPG connection to the BPL households, interest free loan to purchase stove and refill by Oil Marketing Companies.

The finance minister said gas cylinders will be provided free to these families during the next three months. It is expected to benefit eight crore poor families. “It is not just enough to reach them food, they should also have the fuel to cook the food,” the finance minister said.

Women self help groups

Under the National Rural Livelihood Mission, women self help groups were provided loans of up to Rs 10 lakh without any collateral. Now, this benefit has been doubled. these SHGs will get loans up to Rs 20 lakh without any collateral. The minister said this would immediately impact the lives of seven crore families.

Organised sector

Two kinds of welfare measures have been announced for this section. One relates to provident fund. The Centre will pay the Employee Provident Fund (EPF) contribution, the 12 per cent each of both the employer and employee, for the next three months so that, in the words of the finance minister, “nobody suffers on account of a break in continuity”.

This benefit is for establishments that have up to 100 employees and 90 per cent of whom are earning less than 15,000 a month. This may benefit 80 lakh employees and incentivise 4 lakh establishments.

The second measure relates to withdrawal from EPF accounts. The Employee Provident Fund regulations will be amended to allow "non-refundable" advance of 75 per cent of the amount standing to the credit of the employee or three months wages, whichever is lower.

This will benefit 4.8 crore workers registered with EPF.

Construction workers

The finance minister said that by a Central act there was a welfare fund for building and other construction workers. The fund is rich by over Rs 31,000 crore, and has about 3.5 crore registered workers. "We intend to given directions to the state governments to utilise this fund to provide assistance to workers in the building and construction sector to protect them against any economic disruptions," the finance minister said.

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