Modi's December 31 schemes to boost economic growth, if implemented effectively: Assocham

Industry body Assocham termed PM Narendra Modi's various measures announced on December 31, 2016 as 'extremely positive for the Indian economy'. 

While addressing the nation on New Year's Eve, PM Modi announced many schemes like ensuring cheap credit to farmers, pan-India expansion for maternity benefit programme, Pradhan Mantri Awaas Yojana for home loan borrowers, increasing access to credit for SMEs and many more. 

Assocham suggested that the focus of Modi-led government should now be on effective implementation of these schemes to drive economic growth.

Sunil Kanoria, President of Assocham said, “The initiatives like 60-day interest waiver for farmers who have taken loans from district co-operative banks and primary societies together with additional fund of 20,000 crore given to NABARD to give loans to farmers would help in alleviating pains of farmers and rural class."

He added, "Schemes like interest subsidy on loans for low cost housing together with impetus to affordable housing will provide much needed help to vulnerable sections of society and revive consumer confidence amid largest, but poorest socio-economic group."

On credit guarantee to SME and MSME , Assocham's chief said,“ This will provide support to these sectors. The focus should now be on effective implementation of the credit insurance programme so that banks and NBFCs get their money in case of defaults faster than what it has happened in the past.” 

Credit guarantee for SME and MSME has been increased to Rs 2 crore.

Push towards low cost housing is taken as good news for retail portfolio of banks and NBFCs which have been struggling in driving their business in the midst of economic slowdown.

Lastly, he said, “Considering that post-demonetisation there has been a substantial surge in deposits, resultantly banks have started reducing interest rates and further rate cuts will only revive consumption demand and reinvigorate the investment cycle."