New Delhi  - The Indian government Sunday announced a fiscal stimulation package aimed at boosting industrial sectors which have been affected by the global economic recession.

The total spending on the programme from December to March-end would be to the tune of 3 trillion rupees (61 billion dollars), a release from the prime minister's office said.

India's financial year runs from April to March.

The package, which is a combination of incentives and tax reductions, targets labour intensive export industries like textiles, leather, gems and jewellery along with realty, textiles, infrastructure and to a lesser extent the automobile industry.

The package includes an a refinance facilty for small and medium industries announced by the country's federal bank on saturday.

The Reserve Bank of India also announced a cut of one percentage point for key lending rates on Saturday, signalling banks to lower interest rates to increase cash flow in the economy.

The release said the government had consciously allowed the fiscal deficit to expand beyond the original targeted level in recognition of the need for stimulus to increase liquidity and arrest slowing economic growth.

"The government is keeping a close watch on the evolving economic situation and will not hesitate to take any additional steps that may be needed to counter recessionary trends and maintain pace of economic activity," the release added. (dpa)