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FM ANNOUNCES FRESH ECONOMIC PACKAGE , EXTENDS EXISTING SCHEMES
Dated 29.06 .2021 : Union Finance Minister Smt. Nirmala Sitharaman has announced yesterday the extension of Aatma Nirbhar Bharat Rozgar Yojana which was set to expire tomorrow . till 31st March 2022 . Further she announced the extension of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) – Free food grains from May to November, 2021 . She also announced a relief package of Rs 6,28,993 crore for various sectors to support them in fight against COVID-19 pandemic . Some of the measures announced are as follows :
1. Rs 1.1 lakh crore loan guarantee scheme for COVID affected sectors
2. Additional Rs 1.5 lakh crore for Emergency Credit Line Guarantee Scheme
3. Credit Guarantee Scheme to facilitate loans to 25 lakh persons through Micro Finance Institutions (MFIs)
4. Financial support to more than 11,000 Registered Tourists/ Guides/ Travel and Tourism Stakeholders .
5. Free one month Tourist Visa to first 5 lakh tourists
6. Additional subsidy of Rs. 14,775 crore for DAP & P&K fertilizers .
7. Rs. 23,220 crore more for public health with emphasis on children and pediatric care/pediatric beds .
8. 21 varieties of bio-fortified crop for nutrition, climate resilience and other traits to be dedicated to the nation .
9. Revival of North Eastern Regional Agricultural Marketing Corporation (NERAMAC) with package of Rs 77.45 crore .
10. Rs. 33,000 crore boost for project exports through National Export Insurance Account (NEIA) .
11. Rs. 88,000 crore boost to Export Insurance Cover .
12. Rs. 19,041 crore For Broadband to each Village through BharatNet PPP Model .
13. Extension of Tenure of PLI Scheme for Large Scale Electronics Manufacturing till 2025-26 .
14. Rs 3.03 lakh crore for Reform-Based Result-Linked Power Distribution Scheme
15. New Streamlined Process for PPP Projects and Asset Monetization
For complete details of announcements , CLICK HERE
Dated 29.06 .2021 : Union Finance Minister Smt. Nirmala Sitharaman has announced yesterday the extension of Aatma Nirbhar Bharat Rozgar Yojana which was set to expire tomorrow . till 31st March 2022 . Further she announced the extension of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) – Free food grains from May to November, 2021 . She also announced a relief package of Rs 6,28,993 crore for various sectors to support them in fight against COVID-19 pandemic . Some of the measures announced are as follows :
1. Rs 1.1 lakh crore loan guarantee scheme for COVID affected sectors
2. Additional Rs 1.5 lakh crore for Emergency Credit Line Guarantee Scheme
3. Credit Guarantee Scheme to facilitate loans to 25 lakh persons through Micro Finance Institutions (MFIs)
4. Financial support to more than 11,000 Registered Tourists/ Guides/ Travel and Tourism Stakeholders .
5. Free one month Tourist Visa to first 5 lakh tourists
6. Additional subsidy of Rs. 14,775 crore for DAP & P&K fertilizers .
7. Rs. 23,220 crore more for public health with emphasis on children and pediatric care/pediatric beds .
8. 21 varieties of bio-fortified crop for nutrition, climate resilience and other traits to be dedicated to the nation .
9. Revival of North Eastern Regional Agricultural Marketing Corporation (NERAMAC) with package of Rs 77.45 crore .
10. Rs. 33,000 crore boost for project exports through National Export Insurance Account (NEIA) .
11. Rs. 88,000 crore boost to Export Insurance Cover .
12. Rs. 19,041 crore For Broadband to each Village through BharatNet PPP Model .
13. Extension of Tenure of PLI Scheme for Large Scale Electronics Manufacturing till 2025-26 .
14. Rs 3.03 lakh crore for Reform-Based Result-Linked Power Distribution Scheme
15. New Streamlined Process for PPP Projects and Asset Monetization
For complete details of announcements , CLICK HERE
FM ANNOUNCES ATMANIRBHAR BHARAT 3.0
Dated 13.11.2020 : Union Finance Minister Smt. Nirmala Sitharaman has announced 12 key measures, as part of Government of India’s stimulus to the economy, under Aatma Nirbhar Bharat 3.0. The net stimulus announced yester day amounts to ₹ 2.65 Lakh crore including PLI scheme approved by union cabinet for Rs 1.46 Lakh crores. She also informed that the total stimulus announced by the Government and Reserve Bank of India till date, to help the nation tide over the COVID-19 pandemic, works out to ₹ 29.87 lakh crore, which is 15% of national GDP. Out of this, stimulus worth 9% of GDP has been provided by the government.
The 12 schemes announced under the scheme are as follows :
1) Aatma Nirbhar Bharat Rozgar Yojana : A new scheme is being launched to incentivize job creation during COVID-19 recovery. If EPFO-registered establishments take in new employees without EPFO numbers or those who lost jobs earlier, the Yojana will benefit these employees. The scheme will be effective from October 1, 2020.
2) Emergency Credit Line Guarantee Scheme for MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), has been extended till March 31, 2021. Credit guarantee support scheme is being launched for Healthcare sector and 26 sectors stressed due to COVID-19. Entities will get additional credit up to 20% of outstanding credit; repayment can be done in five years (1 year moratorium + 4 years repayment).
3) Production Linked Incentive worth ₹ 1.46 Lakh Crore is being offered to 10 champion sectors. ( Details you can read down below )
4) ₹ 18,000 Crore Additional outlay for PM Awaas Yojana - Urban : This is over and above Rs. 8000 Crore already allocated this year; will help ground 12 Lakh houses and complete 18 Lakh houses; will create additional 78 Lakh jobs and improve production and sale of steel and cement, resulting in multiplier effect on economy.
5) Support for Construction & Infrastructure – Relaxation of Earnest Deposit Money & Performance Security on Government Tenders :
To provide ease of doing business and relief to contractors whose money otherwise remains locked up, performance security on contracts will be reduced to 3%. EMD for tenders will be replaced by bid security self-declaration. The relaxations will be till December 31, 2021.
6) Income Tax relief for Developers & Home Buyers : Differential between circle rate and agreement value in real estate income tax is being increased from 10% to 20%. This is for primary sale of residential units up to ₹ 2 Crore (from date of announcement of this scheme, till June 30 2021). The Income Tax relief provides incentive to middle class to buy homes.
7) Platform for Infra Debt Financing : Govt. will make ₹ 6,000 Crore equity investment in debt platform of National Investment and Infrastructure Fund, which will help NIIF raise ₹ 1.10 Lakh Crore by 2025 for financing infrastructure projects.
8) Support for Agriculture: ₹ 65,000 Crore for subsidized fertilizers
9) Boost for Rural Employment: Additional outlay of ₹ 10,000 Crore is being provided for PM Garib Kalyan Rozgar Yojana. Funds can be used for MGNREGA or for Gram Sadak Yojana, this will help accelerate rural economy .
10) Boost for Project Exports : ₹ 3,000 Crore boost to be given for project exports through assistance given by India to developing countries under Indian Development and Economic Assistance Scheme (IDEAS Scheme). This will help EXIM Bank facilitate these Line of Credit development assistance activities and promote exports from India.
11) Capital and Industrial Stimulus : ₹ 10,200 Crore additional budget stimulus will be provided for capital and industrial expenditure on defence equipment, industrial infrastructure and green energy.
12) R&D grant for COVID Vaccine : ₹ 900 Crore is being provided to Department of Biotechnology for research activities related to COVID-19 vaccine development. This does not include cost of vaccine or logistics for vaccine distribution (whatever is required for that will be provided)
To read the press announcement of finance ministry dated 12 .11.2020 , CLICK HERE
Dated 13.11.2020 : Union Finance Minister Smt. Nirmala Sitharaman has announced 12 key measures, as part of Government of India’s stimulus to the economy, under Aatma Nirbhar Bharat 3.0. The net stimulus announced yester day amounts to ₹ 2.65 Lakh crore including PLI scheme approved by union cabinet for Rs 1.46 Lakh crores. She also informed that the total stimulus announced by the Government and Reserve Bank of India till date, to help the nation tide over the COVID-19 pandemic, works out to ₹ 29.87 lakh crore, which is 15% of national GDP. Out of this, stimulus worth 9% of GDP has been provided by the government.
The 12 schemes announced under the scheme are as follows :
1) Aatma Nirbhar Bharat Rozgar Yojana : A new scheme is being launched to incentivize job creation during COVID-19 recovery. If EPFO-registered establishments take in new employees without EPFO numbers or those who lost jobs earlier, the Yojana will benefit these employees. The scheme will be effective from October 1, 2020.
2) Emergency Credit Line Guarantee Scheme for MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), has been extended till March 31, 2021. Credit guarantee support scheme is being launched for Healthcare sector and 26 sectors stressed due to COVID-19. Entities will get additional credit up to 20% of outstanding credit; repayment can be done in five years (1 year moratorium + 4 years repayment).
3) Production Linked Incentive worth ₹ 1.46 Lakh Crore is being offered to 10 champion sectors. ( Details you can read down below )
4) ₹ 18,000 Crore Additional outlay for PM Awaas Yojana - Urban : This is over and above Rs. 8000 Crore already allocated this year; will help ground 12 Lakh houses and complete 18 Lakh houses; will create additional 78 Lakh jobs and improve production and sale of steel and cement, resulting in multiplier effect on economy.
5) Support for Construction & Infrastructure – Relaxation of Earnest Deposit Money & Performance Security on Government Tenders :
To provide ease of doing business and relief to contractors whose money otherwise remains locked up, performance security on contracts will be reduced to 3%. EMD for tenders will be replaced by bid security self-declaration. The relaxations will be till December 31, 2021.
6) Income Tax relief for Developers & Home Buyers : Differential between circle rate and agreement value in real estate income tax is being increased from 10% to 20%. This is for primary sale of residential units up to ₹ 2 Crore (from date of announcement of this scheme, till June 30 2021). The Income Tax relief provides incentive to middle class to buy homes.
7) Platform for Infra Debt Financing : Govt. will make ₹ 6,000 Crore equity investment in debt platform of National Investment and Infrastructure Fund, which will help NIIF raise ₹ 1.10 Lakh Crore by 2025 for financing infrastructure projects.
8) Support for Agriculture: ₹ 65,000 Crore for subsidized fertilizers
9) Boost for Rural Employment: Additional outlay of ₹ 10,000 Crore is being provided for PM Garib Kalyan Rozgar Yojana. Funds can be used for MGNREGA or for Gram Sadak Yojana, this will help accelerate rural economy .
10) Boost for Project Exports : ₹ 3,000 Crore boost to be given for project exports through assistance given by India to developing countries under Indian Development and Economic Assistance Scheme (IDEAS Scheme). This will help EXIM Bank facilitate these Line of Credit development assistance activities and promote exports from India.
11) Capital and Industrial Stimulus : ₹ 10,200 Crore additional budget stimulus will be provided for capital and industrial expenditure on defence equipment, industrial infrastructure and green energy.
12) R&D grant for COVID Vaccine : ₹ 900 Crore is being provided to Department of Biotechnology for research activities related to COVID-19 vaccine development. This does not include cost of vaccine or logistics for vaccine distribution (whatever is required for that will be provided)
To read the press announcement of finance ministry dated 12 .11.2020 , CLICK HERE
. CABINET APPROVES PLI SCHEME UNDER ATMANIRBHAR BHARAT
CABINET APPROVES PLI SCHEME UNDER ATMANIRBHAR BHARAT
12 .11.2020 : The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi gave its approval yesterday to introduce the Production-Linked Incentive (PLI) Scheme in the 10 key sectors for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – under Atmanirbhar Bharat. The total outlay for the five years period is Rs 145, 980 crores .
The sectors and outlays earmarked for the sector are as follows :
SECTOR DEPARTMENT AMOUNT IN CRORES
1. Advance Chemistry , Cell (ACC) Battery NITI Aayog and Department of Heavy Industries 18100
2. Electronic/Technology Products Ministry of Electronics and Information Technology 5000
3. Automobiles & Auto Components Department of Heavy Industries 57042
4 . Pharmaceuticals drugs Department of Pharmaceuticals 15000
5. Telecom & Networking Products Department of Telecom 12195
6. Textile Products: MMF segment and technical textiles Ministry of Textiles 10683
7. Food Products Ministry of Food Processing Industries 10900
8. High Efficiency Solar PV Modules Ministry of New and Renewable Energy 4500
9. White Goods (ACs & LED) Department for Promotion of Industry and Internal Trade 6238
10 . Speciality Steel Ministry of Steel 6322
Total 145980
Government hopes that the PLI scheme across these 10 key specific sectors will make Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology; ensure efficiencies; create economies of scale; enhance exports and make India an integral part of the global supply chain.
To read the Press notification dated 11.11.2020 , CLICK HERE
FM ANNOUNCES FINANCIAL STIMULUS OF RS 73,000 CRORES FOR THE GOVERNMENT EMPLOYEES AND STATE GOVERNMENTS
LTC CASH VOUCHER SCHEME AND SPECIAL FESTIVAL ADAVANCE SCHEMES LAUNCHED
Dated 13.10.2020 : In view of the present scenario unfolding in India in the wake of spread of pandemic and to give fillip to consumer spending , Finance Minister Ms Nirmala Sitharaman announced various measures to promote consumer spending and help investment expenditure of state governments . Main beneficiaries are Central government employees. . The total outlay for the schemes is expected to cost the exchequer Rs 73,000 crores . The schemes are
Central Government employees get LTC in a block of 4 years in which air or rail fare, as per pay scale/entitlement, is reimbursed and in addition, Leave encashment of 10 days (pay + DA) is paid. But due to COVID-19, employees are not in a position to avail of LTC in the current block of 2018-21. Hence the Government has decided to give cash payment in lieu of one LTC during 2018-21, in which
Full payment on Leave encashment and Payment of fare in 3 flat-rate slabs depending on class of entitlement . Fare payment is made tax free
An employee, opting for this scheme, will be required to buy goods / services worth 3 times the fare and 1 time the leave encashment before 31st March 2021. The scheme also requires that money must be spent on goods attracting GST of 12% or more from a GST registered vendor through digital mode. The employee is required to produce GST invoice to avail the benefit.
2. Special Festival Advance Scheme
A Special Festival Advance Scheme for non-gazetted employees, as well as for gazetted employees too, is being revived as a one-time measure to stimulate demand. All Central Government employees can now get an interest-free advance of Rs. 10,000, to be spent by 31st March, 2021 on the choice of festival of the employee. The interest-free advance is recoverable from the employee in maximum 10 instalments.
The employees will get pre-loaded RuPay Card of the advance value. The Government will bear Bank charges of the card. Disbursal of advance through RuPay card ensures digital mode of payment, resulting in tax revenue and encouraging honest businesses.
3. Special Assistance to the States:
The Central Government is issuing a special interest-free 50-year loan to States of Rs. 12,000 crore Capital Expenditure. The Scheme consists of 3 Parts.
Part - 1 of the scheme provides for:
Rs. 200 crore each for 8 North East states (Rs. 1,600 crore)
Rs. 450 crore each Uttarakhand, Himachal Pradesh (Rs. 900 crore)
Part - 2 of the scheme provides for:
Rs. 7,500 crore for remaining states, as per 15th Finance Commission devolution.
The Finance Minister said that both Part 1 and Part 2 of interest-free loans given to States are to be spent by 31st March, 2021 and 50% will be given initially, the remaining 50% will be given upon utilization of first 50%. Unutilised funds will be reallocated by the Central Government.
Under Part - 3 of Rs. 12,000 crore interest-free loans to states, Rs. 2,000 crore will be given to those states which fulfill at least 3 out of 4 reforms spelled out in Aatma Nirbhar Bharat Package (ANBP) vide Department of Expenditure’s Letter F.No. 40(06)/PF-S/17-18 Vol. V dated 17th May 2020. Rs 2,000 crore is over and above other borrowing ceilings.
Following are the features of this Scheme:
It can be used for new or ongoing capital projects needing funds and / or settling contractors’/ suppliers’ bills on such projects
CAPEX to be spent by 31st March 2021 .This funding will be over and above all other additional borrowing ceilings given to states
Bullet repayment after 50 years, no servicing required for 50 years
4. Enhanced Budget Provisions:The Finance Minister announced an additional budget of Rs. 25,000 crore, in addition to Rs. 4.13 lakh crore given in Union Budget 2020, is being provided for Capital Expenditure on roads, defence, water supply, urban development and domestically produced capital equipment.
The total expenditure is expected to cross Rs 73,000 crores from the above 4 measures .
To read Press release dated 12.10.2020 of Government of India , CLICK HERE
LTC CASH VOUCHER SCHEME AND SPECIAL FESTIVAL ADAVANCE SCHEMES LAUNCHED
Dated 13.10.2020 : In view of the present scenario unfolding in India in the wake of spread of pandemic and to give fillip to consumer spending , Finance Minister Ms Nirmala Sitharaman announced various measures to promote consumer spending and help investment expenditure of state governments . Main beneficiaries are Central government employees. . The total outlay for the schemes is expected to cost the exchequer Rs 73,000 crores . The schemes are
- Leave Travel Concession (LTC) Cash Voucher Scheme
Central Government employees get LTC in a block of 4 years in which air or rail fare, as per pay scale/entitlement, is reimbursed and in addition, Leave encashment of 10 days (pay + DA) is paid. But due to COVID-19, employees are not in a position to avail of LTC in the current block of 2018-21. Hence the Government has decided to give cash payment in lieu of one LTC during 2018-21, in which
Full payment on Leave encashment and Payment of fare in 3 flat-rate slabs depending on class of entitlement . Fare payment is made tax free
An employee, opting for this scheme, will be required to buy goods / services worth 3 times the fare and 1 time the leave encashment before 31st March 2021. The scheme also requires that money must be spent on goods attracting GST of 12% or more from a GST registered vendor through digital mode. The employee is required to produce GST invoice to avail the benefit.
2. Special Festival Advance Scheme
A Special Festival Advance Scheme for non-gazetted employees, as well as for gazetted employees too, is being revived as a one-time measure to stimulate demand. All Central Government employees can now get an interest-free advance of Rs. 10,000, to be spent by 31st March, 2021 on the choice of festival of the employee. The interest-free advance is recoverable from the employee in maximum 10 instalments.
The employees will get pre-loaded RuPay Card of the advance value. The Government will bear Bank charges of the card. Disbursal of advance through RuPay card ensures digital mode of payment, resulting in tax revenue and encouraging honest businesses.
3. Special Assistance to the States:
The Central Government is issuing a special interest-free 50-year loan to States of Rs. 12,000 crore Capital Expenditure. The Scheme consists of 3 Parts.
Part - 1 of the scheme provides for:
Rs. 200 crore each for 8 North East states (Rs. 1,600 crore)
Rs. 450 crore each Uttarakhand, Himachal Pradesh (Rs. 900 crore)
Part - 2 of the scheme provides for:
Rs. 7,500 crore for remaining states, as per 15th Finance Commission devolution.
The Finance Minister said that both Part 1 and Part 2 of interest-free loans given to States are to be spent by 31st March, 2021 and 50% will be given initially, the remaining 50% will be given upon utilization of first 50%. Unutilised funds will be reallocated by the Central Government.
Under Part - 3 of Rs. 12,000 crore interest-free loans to states, Rs. 2,000 crore will be given to those states which fulfill at least 3 out of 4 reforms spelled out in Aatma Nirbhar Bharat Package (ANBP) vide Department of Expenditure’s Letter F.No. 40(06)/PF-S/17-18 Vol. V dated 17th May 2020. Rs 2,000 crore is over and above other borrowing ceilings.
Following are the features of this Scheme:
It can be used for new or ongoing capital projects needing funds and / or settling contractors’/ suppliers’ bills on such projects
CAPEX to be spent by 31st March 2021 .This funding will be over and above all other additional borrowing ceilings given to states
Bullet repayment after 50 years, no servicing required for 50 years
4. Enhanced Budget Provisions:The Finance Minister announced an additional budget of Rs. 25,000 crore, in addition to Rs. 4.13 lakh crore given in Union Budget 2020, is being provided for Capital Expenditure on roads, defence, water supply, urban development and domestically produced capital equipment.
The total expenditure is expected to cross Rs 73,000 crores from the above 4 measures .
To read Press release dated 12.10.2020 of Government of India , CLICK HERE
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PM STRESSES ON ATMANIRBHAR BHARAT ABHIYAN IN HIS INDEPENDENCE DAY SPEECH
DATED 15.08.2020 : Today , in the national address from Red Fort , Prime Minister Mr Narendra Modi emphasized on the importance of ATMANIRBHAR BHARAT ABHIYAN scheme in building the nation . He hoped India will become self reliant country by improving the skill and hence the need to to strengthen skill development to achieve a self-reliant India, for improving our competency. To read complete speech of the PM , CLICK HERE |
WHAT IS ATMANIRBHAR BHARAT ABHIYAN ?
PROGRESS REPORT OF ATMANIRBHAR ABHIYAN
Dated 14.09.2020 : Finance Ministry has yesterday released a report giving information on progress made by the ministry in implementing the Atmanirbhar Abhiyan :
1. Rs 30,000 crore Additional Emergency Working Capital Funding for farmers through NABARD -
As on 28.08.2020, Rs. 25,000 crore has been disbursed. Balance amount of Rs. 5000 crore under Special Liquidity Facility (SLF) allocated to NABARD by RBI for smaller NBFCs and NBFC-MFIs. NABARD is finalising operational guidelines to roll it out soon.
2. Rs 45,000 crore Partial Credit Guarantee Scheme 2.0 for NBFCs, HFCs and MFIs to do fresh lending to MSMEs and individuals -
As on 28.08.2020, Banks have approved purchase of portfolio of Rs. 25,055.5 crore and are currently in the process of approval/negotiations for additional Rs. 4,367 crore.
3. Rs 30,000 crore Special Liquidity Scheme for NBFCs/HFCs/MFIs
SBICAP was assigned to set up a SPV to implement the Scheme. The Scheme was launched through a Press Release dated July 1, 2020. On the same day the regulator RBI also issued a circular to NBFCs and HFCs on the Scheme. As on 11th September, 2020, thirty seven (37) proposals involving an amount of Rs. 10590 crore have been approved. Six (06) applications seeking financing of Rs. 783.5 crore are under process.
4. Rs 3 lakh crore Collateral-Free Automatic Loans for Businesses, including MSMEs -
To provide relief to the business, additional working capital finance of 20% of the outstanding credit as on 29th February 2020, in the form of a Term Loan at a concessional rate of interest will be provided. This will be available to units with upto Rs 25 crore outstanding and turnover of up to Rs 100 crore whose accounts are standard. The units will not have to provide any guarantee or collateral of their own. The amount will be 100% guaranteed by the Government of India providing a total liquidity of Rs. 3 lakh crore to more than 45 lakh MSMEs.
After taking Cabinet approval on 20.05.2020, Department of Financial Services issued Operational Guidelines for the Scheme on 23.05.2020 and Emergency Credit Line Guarantee Scheme (ECLGS) Fund was registered on 26.05.2020. Guidelines amended on 4.8.2020 to include Individual loans for business, enhance loan outstanding ceiling to Rs 50 crore and annual turnover ceiling to Rs 250 crore.
As on 10.09.2020, as reported by Public Sector Banks and top 23 Private Sector Banks, additional credit amounting to Rs. 1,63,226.49 crore has been sanctioned to 42,01,576 borrowers. Amount of Rs. 1,18,138.64 crore has been disbursed to 25,01,999 borrowers as on 10.09.2020.
5. Income Tax Refunds -
Refunds of over Rs. 1,01,308 crore have been issued to more than 27.55 lakh taxpayers between 1st April, 2020 to 8 September, 2020. Income tax refunds of Rs. 30,768 crore have been issued in 25,83,507 cases & corporate tax refunds of Rs.70,540 crore have been issued in 1,71,155 cases. In fact, all corporate tax refunds up to Rs. 50 crore have been issued in all cases, wherever due. Other Refunds are under process.
To read the complete report , CLICK HERE
1. Rs 30,000 crore Additional Emergency Working Capital Funding for farmers through NABARD -
As on 28.08.2020, Rs. 25,000 crore has been disbursed. Balance amount of Rs. 5000 crore under Special Liquidity Facility (SLF) allocated to NABARD by RBI for smaller NBFCs and NBFC-MFIs. NABARD is finalising operational guidelines to roll it out soon.
2. Rs 45,000 crore Partial Credit Guarantee Scheme 2.0 for NBFCs, HFCs and MFIs to do fresh lending to MSMEs and individuals -
As on 28.08.2020, Banks have approved purchase of portfolio of Rs. 25,055.5 crore and are currently in the process of approval/negotiations for additional Rs. 4,367 crore.
3. Rs 30,000 crore Special Liquidity Scheme for NBFCs/HFCs/MFIs
SBICAP was assigned to set up a SPV to implement the Scheme. The Scheme was launched through a Press Release dated July 1, 2020. On the same day the regulator RBI also issued a circular to NBFCs and HFCs on the Scheme. As on 11th September, 2020, thirty seven (37) proposals involving an amount of Rs. 10590 crore have been approved. Six (06) applications seeking financing of Rs. 783.5 crore are under process.
4. Rs 3 lakh crore Collateral-Free Automatic Loans for Businesses, including MSMEs -
To provide relief to the business, additional working capital finance of 20% of the outstanding credit as on 29th February 2020, in the form of a Term Loan at a concessional rate of interest will be provided. This will be available to units with upto Rs 25 crore outstanding and turnover of up to Rs 100 crore whose accounts are standard. The units will not have to provide any guarantee or collateral of their own. The amount will be 100% guaranteed by the Government of India providing a total liquidity of Rs. 3 lakh crore to more than 45 lakh MSMEs.
After taking Cabinet approval on 20.05.2020, Department of Financial Services issued Operational Guidelines for the Scheme on 23.05.2020 and Emergency Credit Line Guarantee Scheme (ECLGS) Fund was registered on 26.05.2020. Guidelines amended on 4.8.2020 to include Individual loans for business, enhance loan outstanding ceiling to Rs 50 crore and annual turnover ceiling to Rs 250 crore.
As on 10.09.2020, as reported by Public Sector Banks and top 23 Private Sector Banks, additional credit amounting to Rs. 1,63,226.49 crore has been sanctioned to 42,01,576 borrowers. Amount of Rs. 1,18,138.64 crore has been disbursed to 25,01,999 borrowers as on 10.09.2020.
5. Income Tax Refunds -
Refunds of over Rs. 1,01,308 crore have been issued to more than 27.55 lakh taxpayers between 1st April, 2020 to 8 September, 2020. Income tax refunds of Rs. 30,768 crore have been issued in 25,83,507 cases & corporate tax refunds of Rs.70,540 crore have been issued in 1,71,155 cases. In fact, all corporate tax refunds up to Rs. 50 crore have been issued in all cases, wherever due. Other Refunds are under process.
To read the complete report , CLICK HERE
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ECONOMIC STIMULUS PACKAGE FOR RS 2 MILLION CRORES : PM
DATED 12.05.2020 : Today , in a national address , Prime Minister Mr Narendra Modi announced a new stimulus economic package of Rs 20 Lakh Crores to fight the economic downturn the country is facing . He also called for self reliance to promote Indian products . He called the economy revival plan as " ATMANIRBHAR BHARAT ABHIYAN " . The details of the package will be announced in next one week by the Finance Minister Ms Nirmala Sitharaman . The quantum of stimulus works out out around 10 % of Indian GDP . |
FM ANNOUNCES MEGA ECONOMIC PACKAGE FOR REVIVAL OF INDIAN ECONOMY
Dated 13.05.2020 : In view of the present scenario unfolding in India in the wake of spread of pandemic and as a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman announced various measures to help the revival of Indian economy which is showing recessionary trend . According to press release of Department of Statistics , Government of India released yesterday , Index of Industrial Production ( IIP ) has shrunk 16.7 % in the month of March 2020 compared with the corresponding month of previous year ( March 2019 ) .
The relief includes
MSME SECTOR
1. Rs 3 Lakh crore collateral -free loans to MSME sector :
Emergency Credit Line to Businesses/MSMEs from Banks and NBFCs up to 20% of entire outstanding credit as on 29.2.2020
• Borrowers with up to Rs. 25 crore outstanding and Rs. 100 crore turnover eligible
• Loans to have 4 year tenor with moratorium of 12 months on
Principal repayment ,• Interest to be capped
• 100% credit guarantee cover to Banks and NBFCs on principal and interest
• Scheme can be availed till 31st Oct 2020
• No guarantee fee, no fresh collateral
2. Provision of Rs 20,000 Crore subordinate Debt for stressed MSME :
GoI will facilitate provision of Rs. 20,000 cr as subordinate debt
• Two lakh MSMEs are likely to benefit
• Functioning MSMEs which are NPA or are stressed will be eligible
• Govt. will provide a support of Rs. 4,000 Cr. to CGTMSE
• CGTMSE will provide partial Credit Guarantee support to Banks
• Promoters of the MSME will be given debt by banks, which will then be infused by promoter as equity in the Unit
3. Rs 50,000 crore Equity infusion through Fund of Funds for MSMES needing hand holding
Fund of Funds with Corpus of Rs 10,000 crores will be set up. • Will provide equity funding for MSMEs with growth
potential and viability. • FoF will be operated through a Mother Fund and few daughter funds
4. New Definition of Micro , Small & Medium Enterprises
As per new definition
( FOR BOTH MANUFACTURING AND SERVICE UNITS )
MICRO ENTERPRISES : Investment< Rs. 1 cr. and Turnover < Rs.5 cr
SMALL ENTERPRISES : Investment< Rs. 10 cr. and Turnover < Rs.50 cr.
MEDIUM ENTERPRISES : Investment< Rs. 20 cr. and Turnover < Rs.100 cr.
INCOME TAX
1 . Due date of all income-tax return for FY 2019-20 will be extended from 31st July, 2020 & 31st October, 2020 to 30th November, 2020 and Tax audit from 30th September, 2020 to 31st October,2020.
2 .Date of assessments getting barred on 30th September,2020 extended to 31st December,2020 and those getting barred on
31st March,2021 will be extended to 30th September,2021.
3. Period of Vivad se Vishwas Scheme for making payment without additional amount will be extended to 31st December,2020.
4. The rates of Tax Deduction at Source (TDS) for non-salaried specified payments made to residents and rates of Tax Collection at Source (TCS) for the specified receipts shall be reduced by 25% of the existing rates. Payment for contract, professional fees, interest, rent, dividend, commission, brokerage, etc. shall be eligible for this reduced rate of TDS. This reduction shall be applicable for the remaining part of the FY 2020-21 i.e. from tomorrow to 31st March, 2021.
5. Date of assessments getting time -barred as on March 31, 2021 extended now to 30,.09.2021
OTHERS :
1. Statutory PF contribution of both employer and employee will be reduced to 10% each from existing 12% each for all establishments covered by EPFO for next 3 months.
2. Rs 30,000 crore Special Liquidity Scheme for NBFCs/HFCs/MFIs
3. Rs 45,000 crores partial guarantee scheme for NBFCs
4. Emergency fund support of Rs 90,000 crores for Discoms.
Please view the YouTube above to hear FM'S speech
For details of FM'S ANNOUNCEMENT , CLICK HERE
FM ANNOUNCES 2ND TRANCHE OF MEGA ECONOMIC PACKAGE FOR REVIVAL OF INDIAN ECONOMY
Dated 14.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 2nd tranche of the measures taken by the Government to help Poor , migrants , farmers , tiny traders and street vendors .
The measures include
• Free food grains supply to Migrants for 2 months.
• Technology system to be used enabling Migrants to access PDS(Ration) from any Fair Price Shops in India by March,2021-One Nation one Ration Card
• Scheme for Affordable Rental Housing Complexes for Migrant Workers and Urban Poor to be launched
• 2% Interest Subvention for 12 months for Shishu MUDRA loanees- Relief of Rs. 1500 crore
• Rs 5000 crore Credit facility for Street Vendors.
• Rs70,000 crore boost to housing sector and middle income group through extension of Credit Linked Subsidy Scheme for MIG under PMAY(Urban)
• Rs 6,000 crore for Creating employment using CAMPA funds
• Rs 30,000 crore Additional Emergency Working Capital for farmers through NABARD
• Rs 2 lakh crore concessional credit boost to 2.5 crore farmers under Kisan Credit Card Scheme
For copy of Press release by PIB on 14.05.2020 , CLICK HERE
Dated 14.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 2nd tranche of the measures taken by the Government to help Poor , migrants , farmers , tiny traders and street vendors .
The measures include
• Free food grains supply to Migrants for 2 months.
• Technology system to be used enabling Migrants to access PDS(Ration) from any Fair Price Shops in India by March,2021-One Nation one Ration Card
• Scheme for Affordable Rental Housing Complexes for Migrant Workers and Urban Poor to be launched
• 2% Interest Subvention for 12 months for Shishu MUDRA loanees- Relief of Rs. 1500 crore
• Rs 5000 crore Credit facility for Street Vendors.
• Rs70,000 crore boost to housing sector and middle income group through extension of Credit Linked Subsidy Scheme for MIG under PMAY(Urban)
• Rs 6,000 crore for Creating employment using CAMPA funds
• Rs 30,000 crore Additional Emergency Working Capital for farmers through NABARD
• Rs 2 lakh crore concessional credit boost to 2.5 crore farmers under Kisan Credit Card Scheme
For copy of Press release by PIB on 14.05.2020 , CLICK HERE
FM ANNOUNCES 3ND TRANCHE OF MEGA ECONOMIC PACKAGE FOR REVIVAL OF INDIAN ECONOMY
Dated 15.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 3nd tranche of the measures taken by the Government to help Agriculture sector .
The measures announced today include
1. Rs 1 lakh crore Agri Infrastructure Fund for farm-gate infrastructure for farmers
2. Rs 10,000 crores scheme for Formalisation of Micro Food Enterprises (MFE)
3. Rs 20,000 crores for Fishermen through Pradhan Mantri Matsya Sampada Yojana (PMMSY)
4. Animal Husbandry Infrastructure Development Fund - Rs. 15,000 crore
5. Promotion of Herbal Cultivation : Rs. 4000 crore
6. Beekeeping initiatives –Rs 500 crores
7. Amendments to Essential Commodities Act to enable better price realisation for farmers
8. Agriculture Marketing Reforms to provide marketing choices to farmers
To read PIB's press release dated 15/05.2020 , CLICK HERE
Dated 15.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 3nd tranche of the measures taken by the Government to help Agriculture sector .
The measures announced today include
1. Rs 1 lakh crore Agri Infrastructure Fund for farm-gate infrastructure for farmers
2. Rs 10,000 crores scheme for Formalisation of Micro Food Enterprises (MFE)
3. Rs 20,000 crores for Fishermen through Pradhan Mantri Matsya Sampada Yojana (PMMSY)
4. Animal Husbandry Infrastructure Development Fund - Rs. 15,000 crore
5. Promotion of Herbal Cultivation : Rs. 4000 crore
6. Beekeeping initiatives –Rs 500 crores
7. Amendments to Essential Commodities Act to enable better price realisation for farmers
8. Agriculture Marketing Reforms to provide marketing choices to farmers
To read PIB's press release dated 15/05.2020 , CLICK HERE
FM ANNOUNCES 4TH TRANCHE OF MEGA ECONOMIC PACKAGE FOR REVIVAL OF INDIAN ECONOMY
Dated 16.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 4th tranche of the measures taken by the Government to fast-track investments by policy reforms in Coal , Mining , power , defence , civil aviation & space sectors .
THE DETAILS OF 4TH TRANCHE OF MEGA ECONOMIC PLAN
1. Policy Reforms to fast-track Investment
2. Upgradation of Industrial Infrastructure
3. Policy Reforms – Introduction of Commercial Mining in Coal Sector
4. Policy Reforms – Diversified Opportunities in Coal Sector - Investment of Rs 50,000 crores
5. Enhancing Private Investments in the Mineral Sector
6. FDI limit in the defence manufacturing under automatic route will be raised from 49% to 74%
7. Efficient Airspace Management for Civil Aviation
8. World-class Airports through PPP
9. Privatization of Distribution in UTs
10. Boosting private participation in Space activities
The press dated 16.05.2020 with regard to 4th tranche can be accessed by CLICKING HERE
Dated 16.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 4th tranche of the measures taken by the Government to fast-track investments by policy reforms in Coal , Mining , power , defence , civil aviation & space sectors .
THE DETAILS OF 4TH TRANCHE OF MEGA ECONOMIC PLAN
1. Policy Reforms to fast-track Investment
2. Upgradation of Industrial Infrastructure
3. Policy Reforms – Introduction of Commercial Mining in Coal Sector
4. Policy Reforms – Diversified Opportunities in Coal Sector - Investment of Rs 50,000 crores
5. Enhancing Private Investments in the Mineral Sector
6. FDI limit in the defence manufacturing under automatic route will be raised from 49% to 74%
7. Efficient Airspace Management for Civil Aviation
8. World-class Airports through PPP
9. Privatization of Distribution in UTs
10. Boosting private participation in Space activities
The press dated 16.05.2020 with regard to 4th tranche can be accessed by CLICKING HERE
FM ANNOUNCES 5TH AND FINAL TRANCHE OF MEGA ECONOMIC PACKAGE FOR REVIVAL OF INDIAN ECONOMY
Dated 17.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 5th and final tranche of the measures taken by the Government to fast-track investments by policy reforms in Health , education and other sectors and an additional allocation of rs 40,000 crores for MNERGA .
THE DETAILS OF 5TH AND FINAL TRANCHE OF MEGA ECONOMIC PLAN :
1. Rs 40,000 crores increase in allocation for MGNREGS to provide employment boost
2. HEALTH SECTOR :
Increased investmentsin PublicHealth –
• PublicExpenditure on Health will be increased.
• Investmentsin grass root health institutions
• Ramp up Health and Wellness Centres in rural and urban areas
Preparing India for any future pandemics –
• Infectious Diseases HospitalBlocks – all districts
• Strengthening of lab network and surveillance –o Integrated Public Health Labs in all districts & block level Labs & Public Health Unit to manage pandemics.
• Encouraging Research–National Institutional Platform for One health by ICMR
• National Digital Health Mission: Implementation of National Digital Health Blueprint
3. EDUCATION SECTOR
Technology Driven Education with Equity post-COVID
• PM eVIDYA- A programme for multi-mode access to digital/online education to be launched immediately; consisting of:
• DIKSHA for school education in states/UTs: e-content and QR coded
Energized Textbooks for all grades (one nation, one digital platform)
• One earmarked TV channel per class from 1 to 12 (one class, one channel)
• Extensive use of Radio, Community radio and Podcasts
• Special e-content for visually and hearing impaired.
• Top 100 universities will be permitted to automatically start online courses by 30th May, 2020.
• Manodarpan- An initiative for psychosocial support of students, teachers and families for mental health and emotional wellbeing to be launched immediately.
• New National Curriculum and Pedagogical framework for school, early childhood and teachers will be launched: integrated with global and 21st century skill requirements
• National Foundational Literacy and Numeracy Mission for ensuring that every child attains Learning levels and outcomes in grade 5 by 2025 will be launched by December 2020
4. Decriminalisation of Companies Act defaults
5. Ease of Doing Business for Corporates :
Direct listing of securities by Indian public companies in permissible foreign jurisdictions.
• Private companies which list NCDs on stock exchanges not to be regarded as listed companies.
• Including the provisions of Part IXA (Producer Companies) of Companies Act, 1956 in Companies Act, 2013.
• Power to create additional/ specialized benchesfor NCLAT
• Lower penalties for all defaults for Small Companies, Oneperson Companies, Producer Companies & Start Ups.
5. Public Sector Enterprise Policy for a New, Self-reliant India :
Government will announce a new policy whereby
• List of strategic sectors requiring presence of PSEs in public interest will be notified
• In strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed
• In othersectors, PSEs will be privatized (timing to be based on feasibility etc.)
• To minimize wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four; others will be privatized/ merged/ brought under holding companies
The press dated 17.05.2020 with regard to 4th tranche can be accessed by CLICKING HERE
Dated 17.05.2020 : As a follow up of PM' s announcement of " Atma Nirbhar Bharat Abhiyan " , Finance Minister Ms Nirmala Sitharaman today announced the details of 5th and final tranche of the measures taken by the Government to fast-track investments by policy reforms in Health , education and other sectors and an additional allocation of rs 40,000 crores for MNERGA .
THE DETAILS OF 5TH AND FINAL TRANCHE OF MEGA ECONOMIC PLAN :
1. Rs 40,000 crores increase in allocation for MGNREGS to provide employment boost
2. HEALTH SECTOR :
Increased investmentsin PublicHealth –
• PublicExpenditure on Health will be increased.
• Investmentsin grass root health institutions
• Ramp up Health and Wellness Centres in rural and urban areas
Preparing India for any future pandemics –
• Infectious Diseases HospitalBlocks – all districts
• Strengthening of lab network and surveillance –o Integrated Public Health Labs in all districts & block level Labs & Public Health Unit to manage pandemics.
• Encouraging Research–National Institutional Platform for One health by ICMR
• National Digital Health Mission: Implementation of National Digital Health Blueprint
3. EDUCATION SECTOR
Technology Driven Education with Equity post-COVID
• PM eVIDYA- A programme for multi-mode access to digital/online education to be launched immediately; consisting of:
• DIKSHA for school education in states/UTs: e-content and QR coded
Energized Textbooks for all grades (one nation, one digital platform)
• One earmarked TV channel per class from 1 to 12 (one class, one channel)
• Extensive use of Radio, Community radio and Podcasts
• Special e-content for visually and hearing impaired.
• Top 100 universities will be permitted to automatically start online courses by 30th May, 2020.
• Manodarpan- An initiative for psychosocial support of students, teachers and families for mental health and emotional wellbeing to be launched immediately.
• New National Curriculum and Pedagogical framework for school, early childhood and teachers will be launched: integrated with global and 21st century skill requirements
• National Foundational Literacy and Numeracy Mission for ensuring that every child attains Learning levels and outcomes in grade 5 by 2025 will be launched by December 2020
4. Decriminalisation of Companies Act defaults
5. Ease of Doing Business for Corporates :
Direct listing of securities by Indian public companies in permissible foreign jurisdictions.
• Private companies which list NCDs on stock exchanges not to be regarded as listed companies.
• Including the provisions of Part IXA (Producer Companies) of Companies Act, 1956 in Companies Act, 2013.
• Power to create additional/ specialized benchesfor NCLAT
• Lower penalties for all defaults for Small Companies, Oneperson Companies, Producer Companies & Start Ups.
5. Public Sector Enterprise Policy for a New, Self-reliant India :
Government will announce a new policy whereby
• List of strategic sectors requiring presence of PSEs in public interest will be notified
• In strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed
• In othersectors, PSEs will be privatized (timing to be based on feasibility etc.)
• To minimize wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four; others will be privatized/ merged/ brought under holding companies
The press dated 17.05.2020 with regard to 4th tranche can be accessed by CLICKING HERE
TOTAL FINANCIAL OUTLAY OF ATMANIRBHAR ABHIYAN
Stimulus from earlier measures Measures Rs crores
1. Revenue lost due to tax concessions since Mar 22nd 2020. 7,800
2. Pradhan Mantri Garib Kalyan Package (PMGKP) 1,70,000
3. PM’s announcement for Health sector 15,000
Total 1,92,800
Stimulus provided by announcements in Part-1
1.Emergency W/C Facility for Businesses, incl MSMEs 3,00,000
2 Subordinate Debt for Stressed MSMEs 20,000
3 Fund of Funds for MSME 50,000
4. EPF Support for Business & Workers 2800
5. Reduction in EPF rates 6750
6. Special liquidity Scheme for NBFC/HFC/MFIs 30,000
7. Partial credit guarantee Scheme 2.0 for Liabilities of NBFCs/MFIs 45,000
8. Liquidity Injection for DISCOMs 90,000
9. Reduction in TDS/TCS rates 50,000
Sub Total 5,94,550
Stimulus provided by announcements in Part-2
1. Free Food grain Supply to Migrant Workers for 2 months 3500
2. Interest Subvention for MUDRA Shishu Loans 1500
3 Special Credit Facility to Street Vendors 5000
4 Housing CLSS-MIG 70,000
5 Additional Emergency WorkingCapital through NABARD 30,000
6 Additional credit through KCC 2,00,000
Sub-Total 3,10,000
Stimulus provided by announcements in Part-3
1. Food Micro enterprises 10,000
2. Pradhan Mantri Matsya Sampada Yojana 20,000
3. TOP to TOTAL: Operation Greens 500
4. Agri Infrastructure Fund 1,00,000
5. Animal Husbandry Infrastructure Development Fund 15,000
6 Promotion of Herbal Cultivation 4,000
7 Beekeeping Initiative 500
Sub-Total 1,50,000
Stimulus provided by announcements in Part-4 and Part-5
1 Viability Gap Funding 8,100
2 Additional MGNREGS allocation 40,000
Sub-Total 48,100
Overall Stimulus provided by Atmanirbhar Bharat Package (Rs. Cr.)
1 Part 1 5,94,550
2 Part 2 3,10,000
3 Part 3 1,50,000
4 Parts 4 and 5 48,100
Sub-Total 11,02,650
5 Earlier Measures Incl PMGKP 1,92,800
6 RBI Measures (Actual) 8,01,603
Sub Total 9,94,403
GRAND TOTAL 20,97,053
VIDEOS RELATING TO FM'S ANNOUNCEMENTS ON VARIOUS DATES
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FM ANNOUNCES ECONOMIC PACKAGE OF RS 1.7 LAKH CRORES FOR THE POOR AND THE FARMERS
Dated 26.03.2020 : In view of the present scenario unfolding in India in the wake of spread of pandemic , Finance Minister Ms Nirmala Sitharaman announced various measures to help the poor , women , farmers and marginalized section of the society . The economic relief package is expected to cost the exchequer Rs 1.7 lakh crores . The relief includes
1. Rs 50 lakhs insurance to health care sanitation workers, ASHA workers, doctors, nurses, paramedics who are the frontline warriors against the pandemic .
2. 5 kg of rice / wheat to 80 crore people .
3. An ex-gratia amount of Rs 1, 000 for senior citizens and widows
4. Wage rate increase under MNERGA scheme from Rs 182 to Rs 202 .
5. Women Jan dhan account holders to get Rs 500 per month for 3 months .
6. Free LPG Cylinders for next 3 months under Ujjawala scheme
7. EPF contribution both of the employer and the employee put together 24% for next three months for those establishments with up to 100 employees, 90% of them earning less than Rs 15,000.
Dated 26.03.2020 : In view of the present scenario unfolding in India in the wake of spread of pandemic , Finance Minister Ms Nirmala Sitharaman announced various measures to help the poor , women , farmers and marginalized section of the society . The economic relief package is expected to cost the exchequer Rs 1.7 lakh crores . The relief includes
1. Rs 50 lakhs insurance to health care sanitation workers, ASHA workers, doctors, nurses, paramedics who are the frontline warriors against the pandemic .
2. 5 kg of rice / wheat to 80 crore people .
3. An ex-gratia amount of Rs 1, 000 for senior citizens and widows
4. Wage rate increase under MNERGA scheme from Rs 182 to Rs 202 .
5. Women Jan dhan account holders to get Rs 500 per month for 3 months .
6. Free LPG Cylinders for next 3 months under Ujjawala scheme
7. EPF contribution both of the employer and the employee put together 24% for next three months for those establishments with up to 100 employees, 90% of them earning less than Rs 15,000.
RBI MEASURES TO EASE THE LIQUIDITY IN THE SYSTEM
Dated 27.03.2020 : Reserve Bank of India ( RBI ) announced various developmental and regulatory policies that directly address the stress in financial conditions caused by COVID-19 .
They consist of:
(i) expanding liquidity in the system sizeably to ensure that financial markets and institutions are able to function normally in the face of COVID-related dislocations; RBI had estimated the easing of liquidity positions of the banks to the tune of Rs 3.74 lakh crores .
(ii) reinforcing monetary transmission so that bank credit flows on easier terms are sustained to those who have been affected by the pandemic;
(iii) easing financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital; and
(iv) improving the functioning of markets in view of the high volatility experienced with the onset and spread of the pandemic. The policy initiatives in this section should be read in conjunction with the MPC’s decision on monetary policy actions and stance in its resolution.
. To read RBI Press Release dated 27.03.2020 , CLICK HERE and HERE
Dated 27.03.2020 : Reserve Bank of India ( RBI ) announced various developmental and regulatory policies that directly address the stress in financial conditions caused by COVID-19 .
They consist of:
(i) expanding liquidity in the system sizeably to ensure that financial markets and institutions are able to function normally in the face of COVID-related dislocations; RBI had estimated the easing of liquidity positions of the banks to the tune of Rs 3.74 lakh crores .
(ii) reinforcing monetary transmission so that bank credit flows on easier terms are sustained to those who have been affected by the pandemic;
(iii) easing financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital; and
(iv) improving the functioning of markets in view of the high volatility experienced with the onset and spread of the pandemic. The policy initiatives in this section should be read in conjunction with the MPC’s decision on monetary policy actions and stance in its resolution.
. To read RBI Press Release dated 27.03.2020 , CLICK HERE and HERE
TAILPIECE : OUR VIEWS ON THE ABHIYAN :
The economic growth or GDP started its declining journey since Demonetization of high value currencies were announced in November 2016 . It was then thought to be a temporary in phenomenon by the Government . But GDP had its southward journey and reached 4.5 % in the second quarter of FY 2019-20 . Unemployment rates started peaking out and industrial production turned negative in most of the recent months . Lack of growth then was attributed to lack of demand by the consumers with spiraling unemployment . To stem up growth and to improve financials of corporates , Finance Minister announced in September 2019 slashing of corporate tax to 25 .17 per cent inclusive of all cess to all domestic companies for the financial year .
It was expected that the move would cost Rs 1.45 lakhs crores to the exchequer of the government .
Added to all its woes of Indian economy , spread of Covid-19 forced national lockout from March 25th , 2020 . When first case was detected in India in January end of this year , government didn't notice the seriousness of the virus . It was thought to be Chinese problem . But the virus spread internationally and WHO had to announce it as pandemic in the first week of march . Thousands of people in Europe , China , & USA lost their lives due to the virus . Then the central government took drastic measures which helped to contain the spread of virus in India during last two months . .
But the lock-down has economic cost with production loss , employment loss and economic disaster . Most of the ill-effects are borne by migrant workers , unorganized labour , farmers , small traders & vendors . But no economic activity big or small remained unaffected . Hospitality industry , airlines , exporters are some of the sectors which were badly affected . Bankers and medical professionals , police took additional burden of work .
In the wake of problems cited above , Prime Minister Mr Narendra Modi announced the economic revival package with a call for self reliance . The revival plan is called Atmanirbhar Bharat Abhiyan . The outlay of all the government initiatives including announcements made by Reserve Bank of India is estimated to be around 20 lakh crores of rupees which amounts to 10 % of GDP . As we go through the outlays , we find that all the outlay is not directly related to address the economic effect of Covid -19 or to mitigate the hardships of the affected persons . Some are longtime awaited policy changes . Some are just created finds for future use . Many initiatives are just fresh loans or additional loans extended to the existing borrowers . Cash component of the plan which directly enters the system immediately to improve economic activities immediately is meager . Whether the initiatives will be effective to mitigate immediate hardships faced by the people or to will take Indian economy back to growth path , time will only tell .
The economic growth or GDP started its declining journey since Demonetization of high value currencies were announced in November 2016 . It was then thought to be a temporary in phenomenon by the Government . But GDP had its southward journey and reached 4.5 % in the second quarter of FY 2019-20 . Unemployment rates started peaking out and industrial production turned negative in most of the recent months . Lack of growth then was attributed to lack of demand by the consumers with spiraling unemployment . To stem up growth and to improve financials of corporates , Finance Minister announced in September 2019 slashing of corporate tax to 25 .17 per cent inclusive of all cess to all domestic companies for the financial year .
It was expected that the move would cost Rs 1.45 lakhs crores to the exchequer of the government .
Added to all its woes of Indian economy , spread of Covid-19 forced national lockout from March 25th , 2020 . When first case was detected in India in January end of this year , government didn't notice the seriousness of the virus . It was thought to be Chinese problem . But the virus spread internationally and WHO had to announce it as pandemic in the first week of march . Thousands of people in Europe , China , & USA lost their lives due to the virus . Then the central government took drastic measures which helped to contain the spread of virus in India during last two months . .
But the lock-down has economic cost with production loss , employment loss and economic disaster . Most of the ill-effects are borne by migrant workers , unorganized labour , farmers , small traders & vendors . But no economic activity big or small remained unaffected . Hospitality industry , airlines , exporters are some of the sectors which were badly affected . Bankers and medical professionals , police took additional burden of work .
In the wake of problems cited above , Prime Minister Mr Narendra Modi announced the economic revival package with a call for self reliance . The revival plan is called Atmanirbhar Bharat Abhiyan . The outlay of all the government initiatives including announcements made by Reserve Bank of India is estimated to be around 20 lakh crores of rupees which amounts to 10 % of GDP . As we go through the outlays , we find that all the outlay is not directly related to address the economic effect of Covid -19 or to mitigate the hardships of the affected persons . Some are longtime awaited policy changes . Some are just created finds for future use . Many initiatives are just fresh loans or additional loans extended to the existing borrowers . Cash component of the plan which directly enters the system immediately to improve economic activities immediately is meager . Whether the initiatives will be effective to mitigate immediate hardships faced by the people or to will take Indian economy back to growth path , time will only tell .
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