Parliamentary panel suggests converting loan credit into direct cash grant for street vendors

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The Parliamentary Standing Committee on Labor suggested studying the possibility of converting the amount of credit given to street vendors under the PM-SVANidhi program into a direct cash grant as a livelihood support. According to the committee, this will help street vendors in India restart their income activities after the COVID-19 pandemic.

Pradhan Mantri Street Vendors Atma Nirbhar Nidhi (PM-SVANIDHI) program was launched in June 2020, enabling street vendors to benefit from a working capital loan of Rs 10,000. The Rs 5,000 crore stimulus was intended to benefit around 50 lakh street vendors whose livelihoods have been heavily affected due to the COVID-19 pandemic. These working capital loans under the PM-SVANIDHI program come with a 7 percent government interest subsidy with a one-year term to be repaid in monthly installments.

In its report on “The impact of Covid-19 on rising unemployment and loss of jobs / livelihoods in organized and unorganized sectors” which was tabled at Lok Sabha on Tuesday, the parliamentary committee noted that out of the 42.45 lakh loan requests received, 25.03 lakh requests were sanctioned and Rs 2,130 crore was paid to 21.57 lakh recipients as of June 28, 2021. However, in a written response to a Lok Sabha issue, the government said on July 29 that 22.7 lakh loans worth over Rs 2,200 crore were paid to street vendors as part of the program.

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This program was intended to provide much-needed relief to lakhs of street vendors who have lost their livelihoods due to the COVID-19 pandemic and subsequent lockdowns. Even as restrictions are easing across the country, conversations with street vendors indicate that business is unlikely to pick up any time soon and these vendors also allege they have problems with authorities in the smooth running of their businesses. daily activities.

The parliamentary committee also noted that special camps were being organized in local urban organizations (ULBs) across the country, with the secretary of the Ministry of Housing and Urban Affairs asking all states / UTs and lending institutions to organize special camps called “Sankalp se Sidhi”. from June 1 to August 15, 2021, where credit institutions must endeavor not only to disburse all sanctioned requests, but also to sanction all pending eligible requests.

The sanction and disbursement of these loans has not been smooth either. In some cases, such as in the shopping streets of Mumbai, many were unable to benefit from the program as they were classified as shops and not street vendors. Street vendors also alleged the reluctance of credit institutions, especially in the private sector, to offer unsecured loans to vendors. These institutions, on the other hand, have raised the fear of an increase in non-productive assets (NPAs) because there is no guarantee. Reports also suggest that banks reported this problem earlier this year that these loans turned into NPAs, with little to no recourse in the event of default as they were unsecured in nature.

In its report, the commission also said that a large number of street vendors were still unaware of the provisions contained in the law on street vendors (protection of livelihoods and regularization of street vending) and recommended that information on the transparency and active implementation of the provisions of the law on which states and cities have established rules and issued certificates of sale, etc., should be made public and periodically updated on the website from the ministry and down to the municipal level, to the extent possible.

“As a long-term measure to alleviate the problems faced by street vendors, the committee recommends that vendors be taken into account during development work involving displacement and that street vendor associations be included in committees. to ensure approval of infrastructure projects through a participatory process. process that meets the needs of all stakeholders, ”he added.

In its report, the parliamentary committee also said the Ministry of Labor had been slow to respond to the migrant crisis by waiting two months until June and being arrested by the Supreme Court before writing to state governments before collect data on migrant workers. He said the Center or the states “are not doing a favor in providing social protection measures to people in distress” and have a duty to urge the government to consider systemic improvements in program implementation.

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