New Delhi: Explaining the meaning of 'atmanirbhar' in different languages, Finance Minister Nirmala Sitharaman on Wednesday said that the Rs 20 lakh crore economic package will spur growth and build a self-reliant India. She further said that it will help push local brands to be competitive at the global level, but not make India an isolationist economy.
"Essentially, this is to spur growth and build a self-reliant India. That is why it is called atma-nirbhar India," she said at a press conference.
Here are the top highlights from her speech:
1. The finance minister has made a major announcement to disallow global tenders up to Rs 200 crore. "Indian MSMEs and other companies have often faced unfair competition from foreign companies. Therefore, global tenders will be disallowed in government procurement tenders up to Rs 200 crore," said said, adding that necessary amendments of General Financial Rules will be effected. "This will be a step towards self reliant India and support Make in India. This will also help MSMEs to increase their businesses," Sitharaman said.
2. Sitharaman said that the stimulus package has 16 different measures. Six of which deal with MSMEs, two relating to EPF, two relating to NBFCs, housing finance corporations and MFI, one on discoms, one on contractors, one on real estate and three on tax measures.
3. Rs 20,000 crore subordinate debt for stressed MSMEs: She said that stressed MSMEs need equity support. The govt will facilitate provision of Rs 20,000 crore as subordinate debt. It is likely to benefit 2 lakh MSMEs. The functioning MSMEs, which are NPA or are stressed will be eligible. Th government will provide support of Rs 4,000 crore to CGTMSE. The CGTMSE will provide partial credit guarantee support.
4. Rs 90,000 cr liquidity injection for DISCOMs: The minister said that unprecedented cash flow has been problem accentuated by demand reduction. DISCOM payables to power generation and transmission companies is currently close to Rs 94,000 crore. PFS/REC will now infuse liquidity of Rs 90,000 to DISCOMs against receivables. The loans will be given against state guarantees for exclusive purpose of discharging liabilities of discoms to gencos.
5. The EPF contribution has been reduced for businesses and workers for three months with Rs 6750 crore liquidity support. The statutory PF contribution of both employee and employer will be reduced to 10 per cent. This is not applicable for PSUs. This is is applicable for the next three months.
6. Extension of registration and completion date of real estate projects under RERA: The FM said that ministry of housing and urban affairs will issue advisories where covid-19 can be treated as an 'Act of God'. The government will extend the registration and completion sou moto by 6 months for all registered projects expiring on or after 25 March, 2020; issue fresh project registration certificates automatically with revised timelines; these measures will de-stress real estate developers and ensure completion of projects.
7. The due date of all income tax returns for assessment year 2020-21 will be extended to November 30, 2020. Similarly, tax audit due date will be extended to October 30, 2020.
Today's press conference is the first of a series of press briefings by the finance minister. The Rs 20 lakh crore sum, which is equal of 10 per cent of India's Gross Domestic Product (GDP), includes Reserve Bank of India's liquidation worth close to Rs 8.04 lakh crore along with Rs 1.7 lakh crore relief package under Gareeb Kalyan Yojana spelled out by Sitharaman last month.
In a televised address to the nation on Tuesday evening, PM Modi had announced Rs 20 lakh crore - equivalent to 10 per cent of India's GDP - in fiscal and monetary measures to support an economy badly hit by the 50-day lockdown to fight the spread of Covid-19.