RBI Chief announces the second acquisition of government securities worth Rs 35,000 crore under G-SAP 1.0
Das declared that banks will lend Rs 50,000 crore in priority to hospitals, oxygen providers, vaccine importers, Covid-19 medicines, and other Covid-related health infrastructure until March 31st, 2022
In an unscheduled speech on Wednesday, Reserve Bank of India governor Shaktikanta Das said that broad and fast measures were required to stop the spreading of the second wave of Covid-19.
Das outlined a series of plans, including a second round of loan reforms and other steps to support the Indian effort against Covid-19.
He confirmed the second procurement of government securities under the Government Securities Acquisition Programme (G-SAP) 1.0, which will take place on May 20th.
The government will purchase securities worth Rs 35,000 crore in the second purchase under G-SAP. G-SAP 1.0 was first announced on April 7th by the RBI in its monetary policy. Das has outlined additional RBI initiatives to combat the pandemic's second surge.
The RBI Chief confirmed, "The first G-Sap auctions elicited an enthusiastic response. G-Sap is contributing to softening of government security yields and in turn private sector borrowing in the market."
Das declared that banks will lend Rs 50,000 crore in priority to hospitals, oxygen providers, vaccine importers, Covid-19 medicines, and other Covid-related health infrastructure until March 31st, 2022.
According to the Governor, a special three-year SLTRO of Rs 10,000 crore at repo rate for small finance banks will be conducted by the RBI, which will now loan to each borrower up to ten lakhs. He noted that the SLTRO facility will be open until October 31st.
Address by Shri Shaktikanta Das, RBI Governor— ReserveBankOfIndia (@RBI) May 5, 2021
The RBI Governor declared that ₹50,000 crore of on-tap liquidity would be made accessible for Covid-19 related medical needs. Banks are to see this as priority sector lending, he added, adding that banks would develop a Covid-19 loan book to that end.
He assured that the central bank is in high alert to maintain financial stability, adding that the forecast for Indian monsoon coming out as normal would help in curbing food inflation.