Self Reliant India: FM Nirmala Sitharaman Announces Stimulus Package Amid Covid 19 Outbreak

PM Narendra Modi had yesterday announced an economic package of 20 lakh crore amid coronavirus lockdown. The finance minister has now announced the details of the package.
Aimed at all sections of the society, including the middle-class, SMEs, labourers, farmers and the industry, the economic package comes to make India a ‘Self-reliant nation.

FM Sitharaman said the announcements will be made in tranches. The financial stimulus announced by PM Modi is almost 10 percent of India’s gross domestic product (GDP) and comes as the country grapples to cope with the economic effects of the coronavirus pandemic.

The FM said that the announcements are based on the existing foundation of reforms.

“Within hours of lockdown, PMKGY was announced. So far, ₹18,000 crore worth grain and rice transfers have happened, and also, pulses. Ration also distributed to non-card-holders. Ujjwala gas connections were given, and cash transfers were made to Jan Dhan accounts,” she said.

₹3 lakh crores collateral-free automatic loans for businesses, particularly MSMEs.

Collateral free loan to be provided to SMEs with 12 month moratorium; 45 lakh units to benefit, she said, announcing parts of the economic package.

For stressed MSMEs, Government to facilitate provision of ₹20,000 crore subordinate debt for equity support. 2 lakh MSMEs likely to benefit.

For MSMEs who may be doing viable business but need handholding because of current situation, the govt announces ₹50,000 crore equity infusion via ‘fund of funds’. This will be operated through ‘mother fund’ and a few ‘daughter funds’.

For govt procurement, global tenders will be disallowed for tenders up to ₹200 crore. Within the next 45 days, all pending payments from government and CPSEs to MSMEs will be cleared.

The earlier announced EPF support for businesses and employees extended till August 2020. This will provide liquidity relief of ₹2,500 crore. EPF contribution for all businesses and workers reduced to 10% from 12% for next three months.

For NBFCs/MFIs, govt to launch ₹30,000 crore special liquidity scheme.

All contractors engaged by the govt will be given an extension of up to 6 months.

To help destress developers, the urban development ministry will issue advisory to states and UT, where in their regulatory authorities be asked to extend registration and completion date for all registered projects expiring on or after March 25, suo moto by 6 months.

TDS and TCS rates cut 25% for 2020-21. Will release liquidity of ₹50,000 crore for non-salaried tax payers.

The dates for the financial year 2019-20 have been pushed back from July 31, 2020 and October 31, 2020 to November 30, 2020

 

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