As addressed by honourable Prime Minister NarendraModi, finance minister NirmalaSitharamanannounced the first tranche of the government’s 20 Lakh Crore economic package to fight the novel coronavirus pandemic.
The package aimed at almost all sections of the society, comprising the middle-class, SMEs, labourers, farmers and the industry. This economic package is themed around “AtmaNirbhar Bharat Abhiyan” an initiative that will help India in stimulating growth and also help in building a self-reliant nation.
Ms.Sitharamansaid “Beginning today, I will lay out details of PM’s Vision over next few days” andannounced 15 special financial packages constituting to the amount of 6 lakh 40 thousand crore rupees that will be benefitting a wide array of sectors.
The Key Highlights of the package revealed are:
* FM NirmalaSItaraman says Prime Minister has laid out a comprehensive vision, and that vision was only laid out after a wide consultations with several sections of the society.
* Intention of this package is to make items from local brands and take it into global level.
* Finance Minister says Self-reliant India does not require India to be an isolationist country.
* Government announces collateral free loansof Rs 3 lakh crore for Micro, Small and Medium Enterprises (MSMEs) with turnover up to Rs100 crore,which have a 4 year tenure and moratorium of 12 months. These loans will be made available till October 31, 2020 and are made 100 per cent credit guaranteed. This collateral will be of help to 45 lakh units to resume their activities and safeguard jobs.
* For the stressed MSMEs government wishes to benefit them with equity support, hence government will facilitate such MSMEs with a provision of Rs 20,000 crore as subordinate debt.
* MSMEs definition has been changed.The new definition of MSME’s address its fear of losing benefits due to outgrowing the previous MSME definition. Now, with the revised definition MSMEs need not worry about growing in size. They can continue to receive MSME benefits
* Central revises investment limit of MSMEs. The investment limit has been revised upwards to Rs 1 crore from the earlier limit of Rs 25 lakh.
* For MSMEs needing support to withstand, aRs 50,000 crore fund of funds (FoFs) is being created through a framework of mother fund – daughter fund, to expand their capacity and to get listed on markets of their choice.
* Global tenders or foreign tenders will be disallowed in government procurement for tenders up to the amount ofRs 200 crore
* Considering MSMEs inability to participate in trade fairs due to COVID-19 seamless e-market linkages across the board will be provided to them.
* All pending payments to MSMEs, from central govt. bodies & PSUs will be done within the next 45 days.
* EPF supportof Rs 2,500 crore for business and workers has been extended for another 3 months, providing liquidity relief and also the Statutory PF contribution for those who have not been covered earlier will be reduced to 10 per cent from 12 per cent. However, The reduction does not apply for Central government.
* The time period of Vivad se Vishwas Scheme for making payment without additional amount is extended to December 31, 2020.
* Five pillars of a self-reliant India are: Economy, infrastructure, system, demography and demand.
* Special liquidity scheme of Rs 30,000 crorehas been launched for NBFCs/HFCs/MFIs.
* For all power distribution companiesa one-time liquidity infusion of Rs 90,000 crore has been made.
* All pending refunds to the charitable trusts and non-corporate businesses and professions will be issued immediately.
* Government announces announcesRs 30,000 crore support for NBFCs, HFCs, MFIs and alsoRs 45,000 crore liquidity infusion through a Partial Credit Guarantee Scheme 2.0 for NBFCs.
* In a major relief to contractors, all Central agencies will be providing an extension of up to 6 months, without any cost to contractor, or to obligations like completion of work including construction and goods and services contracts.
* Ministry of housing and urban affairs will issue an advisory to all the states and UTs enabling invocation of force majeure or in other terms the Act of God measure during the COVID-19 period, for all registered real estate projects that are expiring on or after March 25, 2020.
* Government extends deadline for realty projects by six months
* With effect from May 14 till March 31, 2021, TDS/TCS (tax deducted at source/tax collected at source) will be reduced by 25% of the existing rate and is applicable to all payments.
*Relief for taxpayers: ITR filing due date for financial year 2019-20 has been extended from July 31 and October 31 to November 30 and the tax audit date from September 30 to October 31.
These are the highlights of the first tranche of the government’s 20 Lakh Crore economic packageand over the next few days, Ms.Sitharaman will release more details about the other stimulus measures that have been taken by theModi government amongst the Pandemic to revive countries economy.