Pradhan Mantri Garib Kalyan Yojana

Last Updated : 03 Nov, 2022

Pradhan Mantri Garib Kalyan Yojana

Along with the other provisions of the Taxation Laws (Second Amendment) Act, 2016, Prime Minister Narendra Modi launched the Pradhan Mantri Garib Kalyan Yojana (PMGKY) in 2016. On December 17, 2016, it came into effect under the Ministry of Finance. The government took action in response to the loss caused by the pandemic. The Coronavirus-related lockdown is expected to cost the Indian economy around 9 lakh crores.

Package of Pradhan Mantri Garib Kalyan Yojana

Objectives of Pradhan Mantri Garib Kalyan Yojana:

The PMGKY was initially launched to recover black money from tax evaders by providing them with protection from legal action.
The government provided a chance for tax evaders to disclose unaccounted income with a 49.9% tax rate under the PM Garib Kalyan Yojana scheme. The deposited amount was to be used to eliminate income inequality in the nation.
The government announced relief efforts during the COVID-19 pandemic with the scheme extension in 2020.
The extension’s objective is to promote small businesses and avoid disrupting the employment of low-wage workers (with up to 100 employees).
In accordance with the extension, the central government provides the full employees with EPF contributions (12% of the total wages) and employers’ EPF & EPS contributions (12% of wages), for three months, a total of 24% of the monthly wages.
The government also announced relief packages to help the poor through various initiatives. Ms. Nirmala Sitharaman, the Union Minister of Finance and Corporate Affairs, announced a relief package worth Rs. 1.70 lakh crore under the PMGKY.

Features of Pradhan Mantri Garib Kalyan Yojana:

PM Modi mentioned the extension of the PM Garib Kalyan Yojana to the end of November 2020 in his speech on June 30, 2020. He also mentioned that Rs. 31,000 crores had been deposited in the bank accounts of 20 crore poor families during the previous three months.
Up to November 2020, free food grains were distributed to almost 80 crore poor people, each receiving 5 kg of wheat or rice and 1 kilogram of pulses.
PMGKY’s extension cost Rs. 90 billion rupees.
In response to the Covid-19 epidemic in India, the Finance Minister announced on March 26, 2020, a 1.7 lakh crore Garib Kalyan scheme to help the poor who were impacted by the coronavirus lockdown.
The initiative’s initial validity period was from December 16, 2016, to March 31, 2017, and it was then extended until June 2020.
The PMGKY gave an opportunity to secretly disclose unaccounted income and black money in order to escape prosecution after paying a fine of 50% of the undisclosed income. A further 25% of the undisclosed income is invested into the scheme, which is eligible for a four-year, interest-free reimbursement.
The Union Government of India announced on June 1st, 2021, that it had already extended the “Pradhan Mantri Garib Kalyan Package (PMGKP) Insurance Scheme for Health Workers Fighting COVID-19” for a further year, effective on April 24, 2021.

Benefits of Pradhan Mantri Garib Kalyan Yojana:

The package’s benefits were classified into two parts which are as follows:

Food Security
Direct Benefit Transfer (DBT)

1. Food Security:

The government announced that 80 crore people will receive 5 kg of rice or wheat and 1 kilogram of their preferred pulse per month till the end of November as part of food-related relief initiatives. This benefit will be given in addition to the monthly delivery of 5 kg of rice or wheat.

2. Direct Benefit Transfer (DBT):

The Benefit to Farmers: Under the Kisan Samman Nidhi initiative, the government would front-load an additional Rs. 2,000 for farmers.
Increase in daily wage: The MNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) has increased the daily wage for workers for the next 100 days to Rs. 202. It is expected that 5 crore families will benefit.
Ex-Gratia of Rs.1,000: 3 crore senior, disabled, and widows people in need would get Ex-Gratia financing of Rs. 1,000 from the government over the course of three months.
Free LPG cylinders: 8.3 crore BPL families with LPG connections will receive free LPG cylinders over the course of the next three months because of the Ujjwala program.
Ex-Gratia for women account holders: For the next three months, 20 crores Jan Dhan Yojana Scheme women account holders would get an Ex-Gratia payment of Rs 500.
Avail collateral-free loans: 63 million women’s Self-Help Groups (SHGs) would be eligible to apply for collateral-free loans up to Rs. 20 lakh via the National Rural Livelihood Mission (NRLM).
EPF benefit for workers from the organized sector: The government will pay both employer and employee contributions to the EPF for the next three months (12 percent each). Businesses employing up to 100 employees, 90% of whom are paid less than Rs. 15,000 per month, will benefit from the initiative. Further, the government amended EPFO regulations to permit employees to take out non-refundable advances equal to three months’ salary or 75% of the entire fund, whichever is lower.
Utilization of welfare and district mineral fund: The central government has directed state governments to use the district mineral fund and the welfare fund. The district’s mineral fund is to be utilized for screening, testing, and other criteria in order to combat COVID-19, while the welfare fund is being asked to protect the construction workers.

Pradhan Mantri Garib Kalyan Yojana