Reserve Bank Of India, Governor , Shaktikanta Das announced measures to deal with the second wave of Covid-19 earlier in May. In his address, he said, “The global economy is showing signs of recovery; activity remains uneven across countries and sectors, clouded by downside risks.” Of the view that localised and targeted containment measures enabled businesses to adapt, he opined that the effect on aggregate demand was expected to be moderate in comparison to last year. The Governor credited the healthy domestic financial conditions to the abundant surplus liquidity. To support the micro, small and other unorganised sector entities, the three-year repo operations of Rs.10,000 crore at repo rate, for fresh lending up to Rs.10 lakh per borrower; facility up to October 31’ 2021 for individuals, borrowers and MSMEs with aggregate exposure up to Rs.25 crore who did not avail restructuring under any previous frameworks, were classified as standard on March 31’ 2021 and deemed eligible to be considered under Resolution Framework 2.0. For individuals and small businesses who have availed restructuring of loans under Resolution Framework 1.0, where a moratorium of fewer than 2 years was permitted, lending institutions were given a free hand to increase the period and or extend residual tenure up to a total of two years. The governor called upon the stakeholders to remain resolutely focused on a post-pandemic future of strong and sustainable growth while guarding against future waves. On the measures, Deepak Sood, Secretary-General of ASSOCHAM was among the first to react and is known to have welcomed the steps while seeking more in terms of incentivisation or rationalisation of GST for the MSME.
