Kerala announces package of Rs 5,650 crore to aid small-scale workers hit by COVID-19

Kerala's Finance Minister KN Balagopal has announced a supplementary package of Rs 5,650 crore to help small traders, industrialists and farmers affected by the deadly second wave of COVID-19. The announcement was made during the second session of the fifteenth legislative assembly session held on Friday.

The state has announced that it will bear up to 4% of the interest of the Loans taken from Central and State Financial Institutions, Co-operative Institutions and Commercial Banks for loan value up to Rs. 2 lakhs for a period of six months. This is an interest rebate for a total loan scheme of Rs 2,000 crore. "It aims to benefit one lakh people," the minister stated.

"The rent for the rooms owned by the government is waived for the period from July to December 31," he stated while the assembly received a big applause from the MLAs.

He also announced exemption of Building tax, electricity fixed charges and rent if in government premises for small business entities (MSMEs) from July to December 2021.

In another massive announcement, a complete waiver of all penalty interest for loans provided through Kerala State Financial Enterprises (KSFE) has been waived off between January and September.

Similarly, it also waived interest and penalty interest for KSFE chit fund investors in the same period. "Fifty to 100% interest and penalty interest will be waived off till September 30, depending on the maturity of the chit," he said.

Adding to a pile of relief, the minister announced an extension of a Rs 1 lakh loan at 5% interest to COVID-affected families till September.

Reviving Industry 

The government was in the national limelight for the wrong reason after the Kitex controversy announced incentives for entrepreneurs.

Three projects through Kerala Financial Corporation (KFC) for industrial revival were announced which includes Rs 50 cr loan allocation for Start-Up Kerala to enable 1 crore of loan without collateral security. 

Under this scheme, up to Rs 20 crores is allotted for a project which has started in Industrial estates of the state. Rs 500 crore is earmarked for the same. It was also announced that a third scheme which provides loans of up to Rs 1 crore at an interest rate of 5%, will provide loans to 2,500 new industrial units for the next five years at a cost of Rs 500 crore per annum.

"The scheme is open to young entrepreneurs below 50 years of age. The loan is disbursed annually to 2000 new entrepreneurs who have been trained and found to be competent. Rs 300 crore will be spent for this," Balagopal announced.

The government also announced the disbursement of a two-month welfare pension that is paid together in August.

"Through this, Rs 1700 crore will reach the hands of the people directly. In addition, Rs 526 crore will be spent for the special food kits allotted for the festival of Onam," he said.