Lok Sabha Question No. 105 (UNSTARRED), answered on 2020-09-14
Subject: Impact of Covid-19 on Trade
Ministry: FINANCE
Asked by: Manoj Kishorbhai Kotak

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 105

TO BE ANSWERED ON SEPTEMBER 14, 2020

## IMPACT OF COVID-19 ON TRADE

105. SHRI MANOJ KOTAK:

Will the Minister of FINANCE be pleased to state:

- (a) whether the global COVID 19 has become a serious threat to the economy of India;
- (b) if so, the details thereof;
- (c) whether imports and exports have been badly affected due to COVID-19 and global lockdown
- (d) if so, the details thereof; and
- (e) the detail of various measures announced by the government to tackle the situation and its impact in country?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ANURAG SINGH THAKUR)

- (a) & (b):  India, like other nations in the world, imposed a strict lockdown from 25 th March, 2020 to combat  the  spread  of  COVID-19  and  strengthen  the  country's  health  infrastructure.  From  May onwards, the country has been unlocking itself and its positive impact on the economy is seen in high frequency indicators of July and August, 2020.

(c) & (d):  In July 2020, merchandise exports of India were estimated at USD 23.6 billion, as against USD 26.3 billion in July 2019, while the merchandise imports were at USD 28.5 billion in July 2020, compared to USD 39.8 billion a year ago. This is in line with the contraction  witnessed  in  world trade in the first four months of 2020-21, due to which exports contracted by (-)30.2% and imports by (-) 46.7%, over the corresponding period of the previous year.

- (e) Along with imposition of strict lockdown to contain the spread of COVID-19, Government of India implemented several measures to mitigate the impact of COVID-19 on the economy which, interalia , include:
-  Relief measures for households such as in-kind (food; cooking gas) and cash transfers to  senior  citizens,  widows,  disabled,  women  Jan  Dhan  Account  holders,  farmers; insurance coverage for workers in the healthcare sector; wage increase for MGNREGA

workers and support for building and construction workers; collateral free loans to selfhelp  groups  and  reduction  in  EPF  contributions  under  Pradhan  Mantri  Garib  Kalyan Yojana  and  employment  provision  for  migrant  workers  under  Pradhan  Mantri  Garib Kalyan Rojgar Abhiyaan, amongst others.

-  Relief measures for MSMEs such as collateral-free lending program with 100 percent credit guarantee, subordinate debt for stressed MSMEs with partial guarantee, partial credit  guarantee  scheme for public sector banks on borrowings of non-bank financial companies, housing finance companies (HFCs), and micro finance institutions, Fund of Funds  for  equity  infusion  in  MSMEs,  additional  support  to  farmers  via  concessional credit, as well as a credit facility for street vendors (PM SVANidhi), amongst others.
-  Regulatory and compliance  measures such as postponing tax-filing and other compliance deadlines, reduction in penalty interest rate for overdue GST filings, change in government  procurement rules, faster clearing of MSME  dues,  IBC  related relaxations for MSMEs, amongst others.
-  Structural  reforms  announced  as  part  of  the  Atmanirbhar  Package  which, inter  alia , include  deregulation  of  agricultural  sector,  change  in  definition  of  MSMEs,  new  PSU policy, commercialization of coal mining, higher FDI limits in defence and space sector, development of Industrial Land/ Land Bank and Industrial Information System, revamp of  Viability  Gap  Funding  scheme for social infrastructure,  new  power tariff policy  and incentivizing States to undertake sector reforms.

*****