ECONOMIC STIMULUS PACKAGE
Finance Minister Nirmala Sitharaman announced the economic stimulus package under the Atmanirbhar Bharat Abhiyan announced by the Prime Minister on19 May,2020. The package includes the Pradhan Manthri Garib Kalyan Yojana (PMGKY) declared already to support the poor and destitutes during the pandemic and the Reserve Bank of India initiatives to improve liquidity.
Finance Minister announced the first scheme of granting Rs. 3 Lakh crore collateral free loan to all Micro, Small and Medium Enterprises (MSME) as a stimulus economic package to provide working capital and employment generations.
Stressed MSME will be provided Rs. 20,000 crore as a subordinate debt . Rs. 10,000 crore through an MSME fund of funds will also provided.
Non-banking finance Companies (NBFC), Power distribution companies, Real estate industries and contractors also will be given credit facilities as per the Scheme. NBFCs, Housing Finance Companies and microfinance institutions will be provided Rs. 30,000 crore investments fully guaranteed by the government with an expanded credit guarantee of Rs. 45,000 crore.
For Salaried workers and taxpayers, the deadline for submission of income tax returns for the financial year 2019-20 have been extended to November 30.
The rates of tax deduction at source (TDS) and tax collection at source (TCS) have been reduced by 25 % for the next year.
PF contributions of the workers have been reduced from 12 %to 10 % for both employers and employees for the next three months.
Nearly 45 lakh MSME Units will benefit emergency credits to resume the unit immediately.
FREE FOODGRRAINS TO MIGRANT WORKERS
Finance Minister announced a package of Rs. 3,500 crore for providing free food grains of 5 Kg rice/Wheat and 1 kg pulses to the migrant workers without ration cards.
Nearly eight crore migrant workers staying in relief camps during lockdown will be benefited by the Scheme. State government or NGOs will be contacting the migrant workers to implement the scheme immediately.
Credit facilities will be provided for urban housing schemes and to the farmers and street vendors. Rs.5000 crore earmarked for giving credits to street vendors. 63 lakh crore for giving agricultural loan to farmers.Also 2 lakh crore assistance under PM-KISAN Card beneficiaries.
Rs.6000 crore for boosting employment to adivasis and tribals.
Rs. 1000 crore had already released to respective states under State Disaster Response Funds.
Rs. 14.62 crore for the generation of extended work undern MGNREGA Scheme as of May 13,2020.
AGRI MARKETING REFORMS
Finance Minister announced a series of agri marketing reforms which were pending to permit free interstate trade and e-trade of farm commodities and enactment of laws for contract farming in the country.
No stock limit shall be imposed except in the event of national calamity or famine.
Essential Commodities Act,1955 will be amended to de-regulate cereals, edible oils, oilseeds, pulses onions and potatoes.
Marketing reforms will be taken to sell the products of farmers at their own prices.
The package includes one lakh crore for agri co operative societies, farmer producer organisations and start- ups for boosting farm gate infrastructure.
Rs. 10,000 crore will be provided to micro food enterprises .
Rs. 20,000 crore forfishermen under PM-Matsya Sampada Yojana for fish production in five years.
Rs. 13,000 crore for vaccination of cattle, buffalos, sheep, goats and pigs and Rs.15,000 crore for animal husbandry infrastructures.
Rs. 4000 crores will be spent for promotion of herbal cultivation in 10 lakh hectares of land.
Rs. 500 crore for the bee keeping initiatives in the country.
Finance Minister announced more reforms to indigenise defence production and measures to commercialise mining in coal sector. Mining will be allowed on revenue sharing basis and private companies will be allowed to carry out exploration. 5000 Mining Blocks will be auctioned immediately. Air space restrictions will be liberalised and private participation in space and energy projects are the main highlights of the package to boost growth and employment.
Ban on import of weapon/platforms and FDI limit in manufacturing under automatic route to be increased from 49 % to 74 %. Ordnance Factory Boards would be corporatised and will be listed on the stock market and not be privatised.
Civil aviation sectors/utilisation of the airspace so that flying efficiency increased. Six more airports will be put on auction on PPP mode and additional private investment will be called at twelve air ports to raise Rs. 13,000 crores.
Power departments, utilisation, distribution companies in Union Territories will be privatised.
In Space, out space travel, planetary exploration are be privatised.
ADDITIONAL ALLOCATION TO MGNREGA
In Atomic Energy sector, Research Reactor in PPP mode will be set up for production of medical isotopes.
Additional amount of Rs. 40,000 crore for the MGNREGA and policy welcoming private companies in every sectors was announced by the Finance Minister on Sunday, 17 May. Earlier Rs. 61,000 crore was allocated in the Budget under MGNREGA Scheme.
Total stimulus package amounts more than Rs. 20 Lakh crore and most of the schemes are credit related including Rs. 8 Lakh crore worth liquidity initiatives by Reserve Bank.
Central government increased the borrowing limit of the state from 3 % to 5 % of GDP with certain stipulations in implementing some stimulus packages announced.
Fresh insolvency proceedings suspended for a year.
Public sector firms in non strategic sectors are to be privatised and not more than four PSUs will remain in strategic sectors.
In health sector, public spending will be increased and more health and wellness centres will be opened.
Infectious diseases hospitals and Health Labs are to be set up in all blocks/districts in the country.
Strengthening the public health system should be the very basis for any mechanism to be adopted while dealing any pandemic situations in the country. Low level of public spending on health may be a cause and indicator for the poor quality and limited reach of healthcare in our country.