New Delhi, Mar 21 (IANS): Industry body Assocham has sought a blanket year-long moratorium by banks on debt repayment for both corporates and individuals to deal with the economic fallout of Covid-19.

Accordingly, the industry body sent this proposal in a communication to Finance Minister Nirmala Sitharaman, who heads the Covid-19 Economic Response Task Force.

Recently, Centre set up the FM-led Covid-19 economic response task force, which would assess the requirements of various sectors and also oversee implementation of the proposed measures.

The task force was constituted in the wake of severe impact of Covid-19 on several sectors, including aviation, hospitality and tourism along with the overall economy.

As per Assocham's other recommendations, the industry body called for urgent infusion of liquidity by the Life Insurance Corporation of India into the NBFCs in a quasi-equity format.

"It is difficult to prepare for a Black Swan event like the outbreak of the COVID-19 pandemic. India, like most other countries, has been deeply affected. Unfortunately for India, this has come at a time when the country's credit environment was already fragile and the economy was slowing down," the communication said.

Besides, the industry body suggested that under the present circumstances, law should be amended to allow NBFCs to avail 100 per cent GST credit, instead of the present 50 per cent.

In addition, it called for a thorough review of the NPA guidelines and provisioning forms for the banks.