Prior to this, the Prime Minister of India, Narendra Modi government has announced an extension in the lockdown till 3rd May, 2020 with a hope to stabilise the current scenario. After this, the Governor of the Reserve Bank of India (RBI) Shaktikanta Das made some important announcements at 10 am today. The videos are now out on YouTube. He has announced some fresh measures to support the economy during this lockdown period as the Indian economy has faced a lot for this worldwide epidemic with businesses going down and sudden price hikes and falls which is not a great scene for the economic growth of any nation.
In his today’s speech, Das announced that the Reserve Bank of India would cut reverse repo rate by 25 basis points to 3.75%, while keeping repo rate unchanged, in emergency measures to provide more relief to an economy fighting the fallout of coronavirus. Shaktikanta Das announced Rs 50,000 crore special finance facility to be provided to NABARD (Rs 25,000 crore), SIDBI (Rs 15,000 crore), and NHB (Rs 10,000 crore). He said that the surplus capital will help to refinance the commercial banks and housing finance banks to infuse liquidity into the market. In another major announcement, loans given by NBFCs to real estate companies are to be given similar benefits as given by scheduled commercial banks. To benefit NBFCs and micro-financial institutions, the RBI said it will conduct targeted long-term repo operations (TLTRO) 2.0 worth Rs 50,000 crore, which can be further increased. The RBI has also asked all banks to not make any dividend payments to shareholders due to the ongoing financial challenges. The Reserve Bank has brought down the LCR (Liquidity Coverage Ratio) requirement of banks to 80% from 100%, giving more liquidity to banks. Further, to empower states for adequate borrowing, the RBI has also increased WMA limits by 60 per cent, to plan their market borrowings better. This facility will be available till September 30. Earlier, last month, the RBI cut the repo rate by a massive 75 basis points, while Finance Minister Nirmala Sitharaman had announced a mega economic relief package worth about Rs 1.7 lakh crore.