New Delhi: India is considering a proposal to enhance a loan guarantee programme for small businesses, according to people with knowledge of the matter, as authorities boost measures to help the economy recover from a devastating coronavirus wave.
Prime Minister Narendra Modi's government may allow small companies to borrow an additional 30 per cent of their credit limit, up from 20 per cent announced last year, the people said, asking not to be identified before a formal announcement. The additional debt will be fully backed by the administration.
The latest plan enhances a programme announced last year that guaranteed as much as 3 trillion rupees ($41 billion) of loans to small businesses as Modi tries to revive an economy struggling with the aftermath of the pandemic. The recent wave killed more than 150,000 people in two months, about as many fatalities as the whole of the past year and which prompted the nation's most industrialized states to re-introduce lockdowns.
The government may finalize the plan and announce the details as early as this week. A finance ministry spokesman couldn't be reached.