INSUBCONTINENT EXCLUSIVE:
The Finance Minister said the government will spend Rs 25,000 crore on roads, ports and defence projectsNew Delhi: The government on Monday
announced steps to stimulate consumer demand, including advance payment of a part of the wages of central government employees during the
festival season and more capital spending as it tries to bolster the pandemic-hit economy
The government will allow its employees to spend tax-exempt travel allowances on goods and services, Finance Minister Nirmala Sitharaman
told a news briefing.She said the government will also shore up investment by spending extra Rs 25,000 crore ($3.41 billion) on roads, ports
and defence projects, and offering Rs 12,000 crore in interest-free 50-year loans to state governments for spending on infrastructure before
March 31,2021."All these measures are likely to create an additional demand of Rs 73,000 crore ($9.96 billion)," Ms Sitharaman said, adding
the proposals would stimulate demand in a "fiscally prudent way."Prime Minister Narendra Modi's government, which imposed a tough lockdown
to stem the spread of the coronavirus in March, is pushing ahead with a full opening to try to boost the economy ahead of the usually
high-spending festival season, which runs from October to March.The latest package would not require any extra borrowing by the central
government, Tarun Bajaj, economic affairs secretary at the Ministry of Finance, told reporters.The government said last month it would stick
to revised borrowing target of Rs 12 lakh crore ($163.78 billion) in the current fiscal year ending March, against an earlier estimate of Rs
7.8 lakh crore.India's total coronavirus cases have crossed 7.12 million, second only to the US, with deaths reaching 1,09,150.The Reserve
Bank of India left key policy rates unchanged on Friday, while retaining an accommodative monetary stance to support an economy that is
projected to contract by almost 10 per cent in the current fiscal year.($1 = Rs 73.2670)
