India’s federal cabinet has approved a credit guarantee plan allocating 181 billion rupees ($1.9 billion) to assist businesses and airlines. This initiative aims to mitigate economic repercussions stemming from the conflict in the Middle East.
Under the scheme, the government will extend sovereign guarantees to lenders, facilitating additional loans for eligible borrowers. The program is designed to support businesses in maintaining operations, safeguarding employment, and preserving supply chains. This framework echoes a similar emergency credit line guarantee provided during the Covid-19 pandemic, which offered collateral-free automatic loans primarily to micro, small, and medium enterprises.
The global economy, particularly commerce, has experienced disruption due to the geopolitical situation involving the United States, Israel, and Iran. India, as the world’s third-largest oil consumer and with approximately 90% of its gas shipments originating from the Middle East, faces significant economic considerations. Officials in New Delhi have previously indicated that the current situation could be as impactful as the Covid pandemic was six years prior.
Source: https://www.livemint.com/news/india/india-clears-1-9-billion-loan-guarantee-plan-as-iran-war-hurts-firms-airlines-11778030140696.html
