Financial Arrangements done after Bhuj Earthquake 2001

Financial Arrangements done after Bhuj Earthquake 2001

Calamity Relief Fund (CRF) in each state.

The CRF allocation during the period 2000-05 has been increased to Rs 11007.56 crore as compared with Rs 6304.27 crore during 1995-2000.

The efforts are supplemented by provision of additional assistance from National Calamity Contingency Fund (NCCF) during severe calamities.

Bhuj Earthquake - Financial arrangements
Bhuj Earthquake – Financial arrangements

Calamity Relief Fund (CRF)

  • Came into force from April 1990.
  • Set up by each state for financing natural calamity relief assistance (earthquake, cyclone, flood etc.).
  • Financial share of 3:1 between the Government of India and states.
  • The government of India’s share comes in as grant-in-aid.
  • A state-level committee headed by the Chief Secretary of the state administers the Fund.

National Calamity Contingency Fund (NCCF)

  • Came into force from 2000-01.
  • Aims to assist natural calamities (earthquake, flood, drought etc.) when the magnitude of the disasters require more support than what the state can provide.
  • The initial corpus of NCCF was Rs 500 crore.
  • The National Centre for Calamity Management (NCCM) under the M/o Home Affairs administers the Fund.
  • Assistance provided by the Centre to States from NCCF is financed by levy of special surcharge on Central taxes for a limited period.

Expenditure norms under NCCF and CRF

  • Ex-gratia payment to families of deceased persons: Rs 50,000/- per person.
  • Ex-gratia payment for loss of limbs/eyes: Rs 25,000/- per person.
  • Injury leading to hospitalisation for more than one week: Rs 5,000/ per person.
  • Relief for old, infirm and destitute children: Adults- Rs 20/- per day; children- Rs 10/- per day.
  • Repair/restoration of damaged houses: Fully damaged – Rs 10,000/- (Rs 6,000/- for kuccha); severely damaged – Rs 2,000/- (Rs. 1,000/- for kuccha)
  • Assistance to artisans (as subsidy) for repair/replacement of damaged equipment : Traditional craft – Rs 1,000/- per person; Handloom weavers – Rs 1,000/- per loom.

Gujarat : Assistance provided

  • Immediate relief of Rs 500 crore from the NCCF.
  • NCCF augmented by imposing a 2% surcharge on personal and corporate income tax in Union Budget (2001-02) for assisting Gujarat.
  • Rs 110 crore provided from PM’s Relief Fund.
  • Assistance was provided under various centrally sponsored schemes for reconstruction of social and physical infrastructure.
  • Arrangements were tied up with ADB and World Bank for credit worth US $800 million.
  • NHB and HUDCO set apart adequate funds for housing reconstruction.
  • RBI instructed banks to freeze recoveries and extend liberal loans.
  • Gujarat government was enabled to float tax-free earthquake bonds.

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