The Confederation of Indian Industry (CII) has suggested the finance ministry in a written communiqué to explore an Emergency Loan Credit Guarantee Scheme to rendering support the stressed sectors and explained that ongoing pressure on employment-intensive sectors could hinder economic recovery.
The industry chamber on Sunday has stated that it recommended the Union Finance Ministry to offer assistance to the stressed segments, mainly in the service sectors such as hospitality, tourism aviation and retail to ensure the much-needed liquidity to these sectors that employ a large number of people, who are in dire need to financial support.
“CII appreciates the revenue constraints faced by the government and its impact on the widening fiscal deficit. This intervention, similar to what has been done for the MSMEs will be a win-win for all,” Chandrajit Banerjee, Director General CII, said.
As a part of the ‘Aatmanirbhar Bharat’ package, the centre in May this year announced the Emergency Loan Credit Guarantee Scheme (ECLGS) and allocated Rs 3 lakh crore automatic loans for businesses including micro, small and medium enterprises (MSMEs).
“It is likely that the scheme will utilise around Rs 2 lakh crore. The unutilised amount of around Rs 1 lakh crore, and an additional Rs 50,000 crore, if need be, could be used to extend support to corporates in the stressed sectors, which were earlier not eligible for the current ECLGS scheme,” CII said.
According to CII, a special provision for the mentioned sectors will help them in dealing with the liquidity crunch.