PM Modi Ji emphasized on following on 12th May 2020 and had a vision of announcing 20 lac crores stimulus package in variant basis:

Emphasis on ATMA NIRBHAR BHARAT concept

  • Land and Labor, Law and Liquidity to be in focus
  • Local Brand to be tuned and developed into Global brands
  • Economy, Infrastructure, System, Demand and Population are five pillars of India
  • Reforms driven steps to be taken:

For poor and migrant workers

For agriculture, fisheries

Public sector bank re-capitalisation

DBT based reforms for direct transfers to poor and migrants

Rampant rise in production of PPEs, Test Kits

After the announcement of Relief Package on 23rd march and 26th march 2020 after the advent of the Lockdown, lot of distributions as promised were done like:

Garib Kalyan Package

52,606 crore distributed to 41 crore account holders into Jan Dhan accounts for widows, vigyangs

Grains distributed to  non-card holders

71,738 metric tonnes of pulses distributed

Ensured that 80,000 crores of refunds were given via income tax and drawback refunds sanctioned

Upto 5 lac of income tax refunds given to 14 lacs income tax assessee’s

8 crores Ujawala Yojna cylinders distributed

For farmers, 2000 were transferred in the first week of April 2020

Compliances were relieved for 3 months

Rbi gave relief to increase liquidity into the market

Today for Kutir Laghu Udyog MSMEs, following steps to be taken:

6 specific measures for MSMEs which are the backbone for India who form employment generation for more than 12 crores population-

For Standard MSMEs

  • Collateral free automatic loans to 3 lac crores till 31st October 2020 with no guarantee fees which will benefit 45 lac units to resume businesses
  • The above loan is for 4 years and no repayment for first year (moratorium for 12 months)
  • 25 crores out standings loans or till 100 crores turnover out standings

For Stressed MSMEs

  • 20,000 crores to be given
  • Sub ordinate debt based scheme to be given
  • 2 lacs MSMEs to benefit from this

For Expanding MSMEs

  • 50,000 crores equity fusion to be enabled
  • Corpus of 10,000 crores to be funded

Definition of MSMEs

  • Definition of MSMEs is being changed since if they outgrow the definitions, their benefits used to change
  • Need not worry when they are growing in size
  • Investment limits is being revised upwards
  • Larger invested company to fall in this definition so that they don’t fall out
  • New criteria of turnover based is introduced; earlier it was only investment limit based
  • For Micro units, 25 lacs increased to 1 crores
  • Service investment, from 10 lacs to be increased to 1 crores
  • Turnover can be up to 5 crores
  • Manufacturing and service units as above, will be under definition
  • For Small units, 10 crores investment and turnover till 50 crores
  • For Medium units, 20 crores investment and 100 crores turnover

For Govt Procurements

  • For Govt tenders, tenders up to 200 crores are no longer under global tender route
  • MSMEs can apply for Govt tenders till 200 crores tender
  • This is a vision to take local to global brands

Trade fairs, exhibitions

  • E markets being upgraded and enhanced
  • E markets and e commerce linked to MSMEs
  • Govt of India and will honor all the receivables in next 45 days to infuse liquidity

EPF

  • Units up to 100 workers with 90% of employees under Rs.15,000, relaxation was given earlier
  • Now, liquidity relief given to all epf establishments
  • Extend support to another 3 months – now extended from Mar, Apr and May further extended to June, July, August
  • EPF contribution will be paid by Govt of India
  • 2500 crores infused through this
  • 22 lac employees will be benefitted
  • 67 lac establishments will be benefitted
  • To increase take home salary to employees, statutory PF contribution is reduced from 12% to 10% for those not covered above
  • Govt employer being central PSUs will still pay 12% but employees can have option for 10% contribution
  • 6750 crores support thru above

For NBFCs, Micro financial institutions, Housing Finance Companies

  • 30,000 crores investment scheme to be made
  • Buying debt papers from NBFCs, micro finance institutions who are funding MSMEs
  • Debt papers fully guaranteed by Govt of India
  • 100% credit guarantee as above
  • 45000 crores infusion through partial being extended to NBFCs
  • First 20% clause, taken by govt of india or guaranteed by Govt
  • AA papers or below or Unrated papers eligible for investment
  • This is to improve lending in markets

For DISCOMs

  • Emergency liquidity injection to the extent of 90,000 crores against their receivables
  • PFCs, RECs will give the benefits, discoms will pay gen course who will further pass further to consumers
  • One time benefit will be given

For Infrastructure Projects

  • All govt of India agencies like NHAI which cover construction work, comply with contract conditions
  • Relief to govt contractors
  • Extension is up to 6 months for completion and intermediate milestones
  • Govt will release bank guarantees partially for partial completions

Real Estate

  • Urban development ministry will give guidelines
  • Covid 19 to be treated as an act of God
  • Extension up to 6 months can be given suo moto, if the project was registered on or 25th march 2020
  • Fresh project registration certificate can be issued
  • This will de-stress real estate companies

For Direct Tax

  • TDS/ TCS RATES REDUCTION: For financial year 2020-21, Till 31st march 2021, existing tds rate reduced by 25% across all tds rates
  • Starting from 14th May 2020
  • Liquidity of 50,000 crores in the system
  • Compliance dates extended for all income tax returns for financial year 2019-2020 from 31st July and 31st October 2020 to 30th November 2020
  • Tax audits date extended from 30th September to 31st October 2020
  • Refunds for all charitable institutions, individual, partnership firms, LLPs, non-corporate businesses to be released soon
  • Time barred assessments getting barred extended to 31st December 2020 from 30th September 2020
  • Time barred getting barred as on 31st march 2021 getting extended to 30th September 2021
  • VSVS extended to 31st December 2020.

Also Read-

Atma Nirbhar Bharat: Part-1: Businesses including MSMEs Text of Press Release by FM on 13th May 2020
Atma Nirbhar Bharat: Part-2: Poor, including migrants and farmers Text of Press Release by FM on 14th May 2020
Atma Nirbhar Bharat: Part-3 – Agriculture Text of Press Release by FM on 15th May 2020
Atma Nirbhar Bharat Part-4: New Horizons of Growth Text of Press Release by FM on 16th May 2020
Atma Nirbhar Bharat- Part-5: Government Reforms and Enablers Text of Press Release by FM on 17th May 2020
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6 Comments

  1. Sunder DHINGRA says:

    Namo 20 Lacs crore package for India Reliance via
    MSMEs industry re-startup in Corona time is Excellent step to boost India economy.

  2. bhupi0077 says:

    Very informative and brief… Covering almost everything that has been covered by Hon’ble FM Nirmala Sitaraman ni her speech today….

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