Loan Guarantee Scheme for Covid Affected Sectors

02 July 2021 Current Affairs:The Cabinet approved the Loan Guarantee Scheme for Covid-affected departments.

♦ The scheme allows for funding up to Rs. 50,000 crore to provide a financial guarantee for brownfield expansion and greenfield projects related to health/medical infrastructure 
♦ The Scheme would apply to all eligible loans sanctioned up to 31.03.2022, or until a total of Rs. 50,000 crore is sanctioned, whichever comes first. 
♦ The move follows the disruptions caused by the pandemic’s second wave, which overwhelmed India’s healthcare system.
♦ According to the government statement, the scheme is a direct response to the country’s extraordinary situation caused by inadequate health infrastructure during the pandemic’s second wave. 
♦ The approved scheme is expected to assist the country in strengthening its much-needed healthcare infrastructure while also creating more job opportunities.
♦ The primary goal of LGSCAS is to partially mitigate credit risk (primarily construction risk) and facilitate bank credit at lower interest rates.
♦ It aims to expand India’s medical infrastructure, with a focus on underserved areas.

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