New Delhi:  Prime Minister Narendra Modi gestures as he addresses the nation on the eve of New Year, in New Delhi on Saturday.   PTI Photo/ TV Grab-Courtesy DD(PTI12_31_2016_000188B)
New Delhi: Prime Minister Narendra Modi gestures as he addresses the nation on the eve of New Year, in New Delhi on Saturday. PTI Photo/ TV Grab-Courtesy DD(PTI12_31_2016_000188B)

Modi doles out sops to woo people, but no immediate relief

New Delhi : Prime Minister Narendra Modi on Saturday night announced a slew of sops to reduce the demonetisation pain of the poor and the middle class, but surprisingly did not talk of removing the bank withdrawal limit of Rs 24,000 or other cash curbs which are causing real hardship to both rich and poor in the country.

There were also no dramatic announcements in the PM’s speech and no indication on whether he is going to inflict another blow in the guise of abolishing ‘benami’ properties.

In his 45-minute televised New Year-eve address to the nation, he held out something for all except the rich, be they poor, middle class, farmers, small and medium industries, pregnant mothers and senior citizens.

He described the people”s patience, discipline and determination in the success of his demonetisation drive, braving all difficulties, as a “victory of honesty” and laying foundation of India”s bright future, having no parallel in the world. He also vowed to carry forward this movement of the honest and punish the dishonest.

Modi said he got thousands of letters on the people”s sufferings from the note ban and he felt good that they shared their pain treating him as their own. “Your sacrifice is like a blessing to me,” he said, vowing to take the banks back to the normalcy and asking the bankers to focus on removing the pain of the cash crunch in villages and distant places with a proactive role.

COPYCAT INTEREST RELIEF: Copying from predecessor Dr Manmohan Singh”s scheme of interest relief on housing by the needy, he announced two new schemes, one for the poor, lower middle and middle class in the urban areas and another in the rural areas. The government would give subvention (relief) of 4% in interest on loan up to Rs 9 lakh to build house, and 3% on loans up to Rs 12 lakh under the PM Awas Yojana.

Modi also announced 33% increase in the houses built in the rural areas and announced a new scheme of 3% subvention in interest on loans taken up to Rs 2 lakh for building or renovating a home.

He also went on to announce a monetary help of Rs 6,000 to every pregnant woman in all over 650 districts in the country, a scheme that he had initiated in Gujarat as the chief minister and which came under criticism for irregularities detected in the audit. The money will be transferred to their bank accounts for hospital facilities, including delivery, as also for having healthy food. A scheme already in vogue in 53 districts under a pilot scheme provided Rs 4,000, he said.

In a big relief to the senior citizens shivering with fear of losing on interest in wake of the banks flush with money reducing interest on deposits, Modi assured them a 8% annual interest on the deposits made up to Rs 7.5 lakh, stressing that they can draw the interest income every month.

He also laughed at the critics” claim of demonetisation destroying agriculture, pointing out that rabi sowing compared to the previous year was up by 6% and off-take of the fertiliser also increased by 9%. To take care of the farmers further, he announced that the government will bear the interest on the rabi and kharif loans borrowed from the district co-operative banks and primary societies for 60 days.

He said the government will also compensate the NABARD for loss it suffers in giving funds to the co-operatives at lower interest rate.

Moreover, he promised to convert the Kisan Credit Cards of all 3 crore farmers into the Rupay Cards in the next three months to enable them to buy items instead of going to the banks every time they needed money.


8% interest rate will be guaranteed on deposits of up to Rs 7.5 lakh for 10 years for senior citizens; interest will be paid monthly

Rs 6,000 to be put into accounts of pregnant women in 650 districts for vaccination and other medical use

  • Banks have been asked to raise cash credit limit to small business to 25% from 20%
  • Govt to stand guarantee for loans up to Rs 2 crore from current Rs 1 crore, to small businesses
  • The Govt to pay interest for 60 days on loans taken by farmers for rabi season from district co-operative banks and primary societies
  • 3% interest waiver on loan up to Rs 2 lakh for construction of houses in rural India.
  • Two new schemes under Pradhan Mantri Awas Yojana to provide 4% interest waiver on loan of up to Rs 9 lakh and of 3% on loan up to Rs 12 lakh.

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