According to government officials, the package will likely include an extra Rs 15,000 crore budgetary allocation for infrastructure spending, a special Rs 15,000 crore funding window for real estate companies, a Rs 10,000 crore to Rs 15,000 crore line of credit for non-banking financial companies where credit has dried up, Rs 2,000 crore worth fiscal sops for exports, excise duty cuts for commercial vehicles, interest rate subsidy for housing loans, special terms of credit for automobile companies and a further relaxation in the norms for external commercial borrowings.

In addition to all this, the government is separately working on a special fund for the infrastructure sectors which could be as big as Rs 50,000 crore or $10 billion. This package will not be announced on Saturday as it’s still in the works. “The RBI, National Housing Bank and Sidbi will contribute to the corpus of this fund. The finance ministry is preparing the proposal,” an official said. Efforts are also simultaneously on to expedite the draw-down of $3 billion the World Bank has promised this year. A portion of it will go to institutions such as IIFCL and Power Finance Corp. Another chunk will go to PSU banks as Tier-2 capital to help them leverage it for infrastructure funding.

The Indian economy which maintained a healthy clip of 9 per cent-plus growth rate on an average over the last four year suddenly seems to have lost steam. Hit by the global meltdown, the GDP growth rate slipped to 7.9 per cent and 7.6 per cent in the first two quarters of the current fiscal. Sectors such as automobiles, banking and NBFCs, real estate and housing and exports that did remarkably well in the last four years, are struggling for credit and consumers.

The apex committee chaired by Prime Minister Manmohan Singh that met on Tuesday approved the broad contours of the multi-sector stimulus package and directed the Committee of Secretaries led by Cabinet Secretary KM Chandrasekhar to finalise the blueprint of the package today. With Assembly elections concluding on Friday, it was decided to announce the package on Saturday.

The signs of a slowing economy are gathering fast. an official said, a commerce department survey of 121 export companies says they lost 65,000 jobs in just three months, from August to October 2008. They also suffered a loss of export orders worth Rs 1,792 crore. “Exports that stood at $163 billion are expected to be between $155 billion (worst case scenario) and $175 billion (best case scenario) this fiscal,” he said. The CoS has agreed to refund of service tax, DEPB benefits and other sops totaling about Rs 2,000 crore, he added.

The objective, according to officials, was to help corporate India tide over the current credit crisis with even the best of AAA-rated companies unable to get bank loans, even at 13 per cent. “The prevailing situation, if allowed to continue, will kill the growth story so assiduously built over the last four years,” an official said. Accordingly, the sectors that create most jobs and have a huge spillover impact such as real estate, automobiles and NBFCs, will get due attention.

To give a fillip to the automobile industry, besides special terms of credit to companies, the government is also set to cut excise duty rates on commercial vehicles whose sales plunged 36 per cent in November. At present, the excise duty on buses is 12 per cent and on trucks, 14 per cent.