The Italian government on Friday adopted an emergency plan to help the automobile sector which has been hit hard by the global economic crisis.

The package also included measures to boost the sales of motorbikes, home appliances and furniture, for which demand has plunged in recent months.

The measures were contained in a decree which takes immediate effect and needs to be approved by parliament within 60 days.

Italian Industry Minster Claudio Scajola explained that it was imperative to adopt the decree "because the automobile market is at a standstill."

Italian Premier Silvio Berlusconi said that measures contained in the package "could boost consumer spending by between 0.5 percent and, optimistically, 1 percent. In turn this could significantly improve prospects for GDP this year, which is currently expected to shrink by 2 percent."

The head of Italy's industrial employers association Confindustria, Emma Marcegaglia, agreed and said the package "is a step forward but much more needs to be done" to help industry.

The government's action boosted Fiat shares in Milan which shot up by over 6 percent and helped pull up the whole stock market.

The incentives, which expire at the end of the year, included a cash bonus of 1,500 euros for the purchase of new cars, those with a Euro 4 or Euro 5 emissions rating.

A bonus of 2,500 euros will be given for the trade-in of light commercial vehicles with high emission ratings -- Euro 0, 1 and 2 - - in exchange for new, less polluting vehicles.

A 1,500-euro bonus will be given for the acquisition of vehicles which run on electricity, hydrogen, methane or natural gas.