Mega Economic relief package to make India a self-reliant nation: Key highlights

Team Udayavani, May 15, 2020, 2:26 PM IST

Prime Minister Narendra Modi has announced a mega economic relief package worth Rs 20 lakh crore to make India a self-reliant nation amid the coronavirus crisis

Finance Minister Nirmala Sitharaman announced some details of the Atmanirbhar Bharat Abhiyan economic package on Wednesday.

Key highlights of part 1:

MSME:

1.₹3 lakh crore collateral-free Automatic Loans for Businesses, including MSME’s. Borrowers with up Rs 25 crore outstanding and Rs 100 crore turnover are eligible

2.Stressed MSMEs will get ₹20,000 crore of subordinate debt. Under this scheme, promoters will be given debt by banks, which will then be infused into the MSME as promoter equity.

3.A fund of funds being created for infusing about Rs 50,000 cr as equity into MSMEs. This will benefit those MSMEs who have the potential and are viable. The corpus of the fund will be of Rs 10,000 crore.

4.A new definition of MSMEs, which increases the threshold limit for investment in these units. This move will help the MSME sector grow in size, allowing them to expand their operations while still availing the benefits of MSME

TDS/TCS rates:

1.A 25 percent reduction in existing rates for tax deducted at source for specified non-salary payments which are made to residents.

2.Payment for transactions like contract, professional fees, interest, rent, dividend, commission, brokerage, will be eligible for reduced TDS rates.

3. Reduction in rates for TDS and TCS will result in release of liquidity of Rs 50,000 crores, as per government’s estimates.

Due Date of  all Income Tax returns:

1.Due date for all income tax returns for FY2019-20 has been extended from July 31 and Oct. 31 to Nov. 30.

2.Tax audit due date has been extended from Sept. 30 to Oct. 31. Date of assessments getting barred on Sept. 30 has been extended to Dec. 31.

3.Similarly, assessments getting barred on March 31, 2021 are extended till the end of September 2021.

EPF Support:

1.Employee Provident Fund (EPF) support, provided to low-income organised workers in small units under the PMGKY is being extended for another three months and is expected to provide liquidity relief of ₹2,500 crore.

Second tranche of  economic package focuses on migrants, farmers and street vendors

Key highlights of Part 2:

Migrants:

1.Centre will bear the cost of Rs 3,500 crore to give free food grains and pulses to migrant workers.

2.8 crore migrant workers will get 5 kilogrammes of grains and 1 kilogramme of pulses free for two months.

3.Government plans to allow inter-state portability of ration cards under the public distribution system (PDS) so as to allow them to use their cards anywhere to get food grains.

4.’One Nation, One Ration Card’, is expected to benefit eight crore migrant labourers by August 2020

5.Under PM Awas Yojaan, scheme for rental housing for migrant workers. Under the scheme incentives will be offered to private manufacturing units and industrial units to develop affordable housing, converting govt funded houses into affordable renting accommodations for migrant workers

Farmers:

1.2.5 crore farmers will be provided Rs 2 lakh crore of concessional credit through Kisan Credit Cards.

2.For post-harvest Rabi and current Kharif crop requirements in May and June, NABARD will provide Rs 30,000 crore additional emergency working capital funding for farmers through rural cooperative banks and regional rural banks.

3.NABARD will provide Rs 30,000 crore additional emergency working capital funding for farmers through rural cooperative banks and regional rural banks.

4.Extension of interest subvention and prompt repayment incentive on crop loans due from March 1 to May 31. About 25 lakh new Kisan Credit Cards will be sanctioned with a loan limit of Rs 25,000 crore.

Street vendors:

1.Credit facility of Rs 5,000 crore will be started for 50 lakh street vendors within a month in which initial working capital of Rs 10,000.

2.Credit-Linked Subsidy Scheme for middle income group extended up to March 2021, from March 2020 earlier. This is expected to benefit 2.5 lakh families, and lead to investment in housing of Rs 70,000 crore.

Others:

1.To create job opportunities for tribals, and in urban, semi-urban and rural areas, the government will approve afforestation and forest management plans worth Rs 6,000 crore

2.Current portfolio of Shishu loans under Mudra scheme will get interest subvention support of 2 percent for 12 months where maximum loan amount is Rs 50,000. This is expected to benefit 3 crore people, and cost Rs 1,500 crore to the government.

3.Special drive for providing Rs 2 lakh cr concessional credit to PM-Kisan beneficiaries through Kisan Credit cards covering 2.5 crore farmers, fishermen and animal husbandry farms.