global economy

Millions of Indians to get Diwali loans to boost battered economy

Agence France-Presse

This is AI generated summarization, which may have errors. For context, always refer to the full article.

Millions of Indians to get Diwali loans to boost battered economy

Women paint oil lamps or 'diyas' made with a mix of cow dung and mud ahead of the Diwali festival at Jai Mahakal Gir Gaushala (cow shelter) in Nidhrad village, India, on October 8, 2020. - Diyas, which are lit and placed around the home, are in heavy demand during the Diwali festival, which marks the victory of good over evil, or the light over darkness. (Photo by SAM PANTHAKY / AFP)


Indian government employees will be given a 10,000-rupee ($135) salary advance to be repaid over 10 months, in a bid to encourage spending

Millions of Indian public servants will be offered loans of around US$135 – to be repaid over 10 months – in a bid to boost spending and salvage the coronavirus-ravaged economy, the government said on Monday, October 12.

The offer comes days after the World Bank said the economy would contract by nearly 10% this year, and coincides with next month’s celebration of Diwali, one of the country’s most important religious festivals.

Finance Minister Nirmala Sitharaman said federal government employees would also be allowed to spend about US$3.8 billion worth of unused travel benefits – which are part of their salaries – on goods and services.

“Festivals are coming…and we want to tell you that in the next 6 months, spend the money on buying goods that will help your family,” Sitharaman told a news conference.

With the loan scheme, the government will spend 80 billion rupees (US$1.1 billion) to give government employees a 10,000-rupee ($135) salary advance to be repaid over 10 months.

Sitharaman said the plan, aimed at encouraging Indians to spend some of their savings, would generate about US$4.9 billion for the economy.

The measures “would energize growth over the remaining part of the year,” the Federation of Indian Chambers of Commerce and Industry said following the announcement.

The government has also set aside US$1.6 billion for 50-year loans to states to spend on roads, defense, and other infrastructure by March.

The stimulation measures would not fuel inflation or put public debt “on an unsustainable path,” Sitharaman said.

India has been easing a nationwide coronavirus lockdown since June but millions have lost their jobs. –

Add a comment

Sort by

There are no comments yet. Add your comment to start the conversation.

Summarize this article with AI

How does this make you feel?

Download the Rappler App!