Lok Sabha Question No. 2967 (UNSTARRED), answered on 2022-03-21
Subject: Impact of Covid-19 on Economy
Ministry: FINANCE
Asked by: Shyam Yadav Singh

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

## LOK SABHA

## UNSTARRED QUESTION NO. 2967

TO BE ANSWERED ON MARCH 21, 2022

## IMPACT OF COVID-19 ON ECONOMY

## 2967. SHRI SHYAM SINGH YADAV:

Will the Minister of FINANCE be pleased to state:

- (a) whether any assessment has been made regarding the overall impact of Covid-19 crisis on Indian economy in terms of closure of industrial units, loss of jobs, etc;
- (b) if so, the details thereof; and
- (c) the result of various measures taken by the Government to reduce the impact of the said Covid-19 crisis?

## ANSWER

## MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHURY)

- (a)  &  (b)  As  per  the  1 st Revised  Estimates  released  by  National  Statistical  Office  (NSO),  Ministry  of Statistics and Program Implementation (MoSPI), India's real Gross Domestic Product (GDP) is estimated to have contracted by 6.6 per cent during FY 2020-21. This contraction reflects the unparalleled effect of the COVID-19 pandemic and the containment measures that were taken to control the pandemic.

The fundamentals of the economy remain strong as gradual scaling back of Covid-19 restrictions, along with the astute support of various government interventions has placed the economy firmly on the path of recovery. As per 2 nd Advance Estimates released by NSO, GDP is estimated to grow at 8.9 percent in 2021-22 with the level of real GDP surpassing the pre-COVID level of 2019-20.

With regard to the manufacturing sector, manufacturing sector Gross Value Added (GVA) is estimated to have contracted by 0.6 percent in 2020-21, but estimated to grow by 10.5 percent in 2021-22 as per the second advance estimates

Similar trend is witnessed in case of Index of Industrial Production (IIP). The cumulative growth of IIP for the period April-January 2021-22 is 13.7 per cent as compared to (-)12.0 per cent in April-January 202021, indicating significant improvement of industrial production in the current financial year.

Restrictions imposed on account of Covid-19 has had an impact on labour market as well in 2020-21. With  the  recovery  in  2021-22,  the  labour  market  has  been  buoyant.  Net  payroll  data  of  Employees' Provident  Fund  Organisation  (EPFO)  as  on  20th  February,  2022,  shows  new  subscribers  increasing from 77.1 lakhs in 2020-21 to 92.4 lakhs during April-December period of 2021-22.

- (c)  The  economic recovery in 2021-22 is a result of measures taken by Government. In FY 2020-21, Government had announced a special economic and comprehensive package under AtmaNirbhar

Bharat (ANB) Abhiyaan to combat the impact of the Covid-19 pandemic, to revive economic growth and to bolster employment. The package included, among others, in-kind and cash transfer relief measures for households, employment provision measures under Pradhan Mantri Garib Kalyan Rojgar Abhiyaan and increased allocation under MGNREGS, credit guarantee and equity infusion-based relief measures for  MSMEs  and  NBFCs  and  regulatory  and  compliance  measures.  Structural  reforms  were  also announced as part of the AtmaNirbhar Bharat Package which, inter alia, included 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 reforms.

The  implementation  of  the  package  is  reviewed  and  monitored  regularly.  Some  of  the  salient achievements include:

-  Under Pradhan Mantri Garib Kalyan Package, free food grain for 80 crore people, ex-gratia of Rs. 500 per month for three months to Women Jan Dhan account holders, free cooking gas for 8 crore families was provided along with increasing the limit of collateral free lending to Self-Help groups.
-  Pradhan Mantri Garib Kalyan Rojgar Abhiyaan was launched on 20th June, 2020, for a period of 125  days.  A  total  of  50.78  crore  person-days  of  employment  was  generated  incurring  an expenditure of Rs. 39,293 crore.
-  Rs.3 lakh crores Emergency Credit Line Guarantee Scheme (ECLGS) for Businesses, including MSMEs, which has subsequently been increased to Rs. 5 lakh crore, in Budget 2022-23.
-  Rs. 50,000 crore equity infusion through MSME Self-Reliant India Fund.
-  Under Aatmanirbhar Bharat Rojgar Yojana (ABRY), benefit of Rs. 4055.9 crore has been given to 51.9 lakh beneficiaries of 1,34,568 establishments till 12.03.2022.

Union  Budget  2022-23  announced  a  number  of  measures  to  support  broad-based  and  inclusive economic  development  including,  among  others,  rise  in  public  investment  with  enhanced  capital expenditure  outlay,  push  to  PM  GatiShakti,  enhanced  outlay  for  'Scheme  for  Financial  Assistance  to States  for  Capital  Investment',  extension  of  Emergency  Credit  Line  Guarantee  Scheme  (ECLGS)  to enterprises  in  hospitality  and  related  services,  Raising  and  Accelerating  MSME  Performance  (RAMP) programme with outlay of Rs 6,000 crore over 5 years to be rolled out to make the MSME sector more resilient, competitive and efficient.

*****