BRICS' Bank provides USD 1 billion loan to India to combat COVID-19
The 'Emergency Assistance Program Loan' to India was approved by the Board of Directors of the bank on April 30, 2020.
The BRICS’s New Development Bank has decided to provide USD 1 billion emergency assistance loan to India to support its efforts to combat the coronavirus pandemic, contain its spread and reduce human, social and economic losses.
The 'Emergency Assistance Program Loan' to India was approved by the Board of Directors of the bank on April 30, 2020. “The loan was approved in response to the immediate financing needs of the Indian Government in fighting COVID-19," said NDB Vice President and CEO Xian Zhu in a statement on May 12, 2020.
The NDB CEO further stated that the bank is fully committed to supporting its member countries in the time of calamity.
• The NDB’s emergency assistance loan programme aims to cover healthcare sector emergency response and strengthen social safety net for expenditures already incurred since January 1, 2020 and the expected public expenditures for future transmission containment and social safety net associated with COVID-19 up to the March of 2021.
• The programme aims to detect, prevent and respond to the threat posed by coronavirus. It also aims to fund critical healthcare expenditure, which will help enhance India’s healthcare capacity and strengthen the preparedness of the national health systems and provide immediate economic assistance to the vulnerable and affected groups, enabling economic and social recovery.
• The NDB Board of Governors had welcomed the establishment of an Emergency Assistance programme to meet the emergency needs of the bank’s member countries in its statement on response to the COVID-19 pandemic.
• The emergency loans can be used by the member nations to finance their direct expenses related to their fight against the deadly outbreak and to support government measures aimed at the revival of the economy.
What is NDB?
The New Development Bank (NDB) was set up by the BRICS (Brazil, Russia, India, China, South Africa) countries in 2014. The bank is currently headed by veteran Indian banker K V Kamath.
The bank aims to mobilise resources for infrastructure and sustainable development projects in BRICS countries and other emerging economies and developing nations.
It aims to complement the existing efforts of multilateral and regional financial institutions for global growth and development.
Indian Prime Minister Narendra Modi on May 12, 2020 announced the launch of the Atmanirbhar Bharat Abhiyan package, which includes a slew of new initiatives to spur growth and revive the economy that had been stalled due to the nationwide lockdown imposed to contain COVID-19 outbreak.
The Atmanirbhar Bharat Abhiyan package combined with previously announced packages amounts to Rs 20 lakh crore, which is 10 percent of India’s GDP.