The government will have to make an additional budgetary provision to the tune of Rs 3,500 crore to pay for the slew of welfare measures announced by Prime Minister Narendra Modi for the poor, pregnant women and farmers on the eve of the New Year, says a report.
“The overall fiscal impact of all these measures announced by the PM on December 31, will be around Rs 3,500 crore per year, which is minimal compared to the social and economic benefits,” SBI Research said in a note on Tuesday.
Modi announced a slew of schemes for multiple beneficiaries last Saturday, in a bid to soften the blow of demonetisation drive between November 8 and December 30.
In what looked like a mini-Budget speech, Modi announced interest subventions for agricultural loans, financial assistance of Rs 6,000 for pregnant women and an increase in the number of houses being built for poor by a third, among others. The note said the interest subvention on agri loans will result in a fiscal burden of Rs 1,300 crore, schemes for women and children will be a fiscal drag of another Rs 1,200 crore and the benefits under the PM Awas Yojana will cost Rs 1,000 crore to Exchequer.