look news india
Amidst the ongoing Iran-Israel war in the Middle East and the resulting global energy crisis, the Indian government is preparing to take a big step to save the industries. According to an exclusive report by CNBC-Awaaz, the Finance Ministry is seriously mulling over ‘Loan Moratorium’ to provide relief to loan repayments, especially to Micro, Small and Medium Enterprises (MSMEs). If this proposal is passed, the war-affected sectors may get a big relief for some time by paying their installments (EMIs).
You can get ‘Oxygen’ with EMI of 3 to 6 months
According to Economic Policy Editor Laxman Rai, the government will EMI for 3 to 6 months Is considering giving exemption for non-payment.
Objective: The rise in crude oil prices and supply chain disruptions due to the Iran war are hurting small industries. In such a situation, the moratorium will work to provide them financial ‘oxygen’.
Demand: Big exporters and industry bodies of the country had demanded relief from the government during this crisis.
Impact on banking sector: This decision will have a direct impact on the balance sheet and NPA management of banks, hence discussions are going on with the banking regulators.
Energy crisis and review of economic fundamentals
The Government is currently closely reviewing the impact of rising energy costs on industries. While on one hand there are preparations to provide relief to the industry, on the other hand the Finance Minister Nirmala Sitharaman Has expressed confidence about the economic condition of the country.
Strong Economy: In response to a question in the Lok Sabha, the Finance Minister said that India’s economic fundamentals are very strong. The whole world is praising our fiscal deficit management.
Foreign exchange reserves: India’s foreign exchange reserves are in a solid position, capable of withstanding any external shock.
Rupee against dollar: better position than other Asian countries
Allaying concerns over the rupee’s decline, the Finance Minister clarified that the Indian rupee is doing “absolutely fine” against other emerging economies.
Comparative Decline: He said that due to the West Asian conflict, many Asian currencies have weakened.
Statistics: While the South Korean Won (4.6%), Thai Baht (5.5%) and Philippine Peso (4.8%) have seen major declines, the rupee remains fairly stable against them.
Market trend: Minister of State for Finance Pankaj Chaudhary also told the House that RBI and the government are keeping a round-the-clock watch on the movement of the currency.
