Nirmala Sitharaman announcement : First part of the Rs 20 lakh crore economic stimulus unveiled
Updated: May 22, 2020
FM Nirmala Sitharaman today shared the first installment of the mega Rs 20 lakh crore package with the focus today being on the relief to the MSME sector. The Prime Minister had announced the Aatmanirbhar Bharat package that will focus on making India self-reliant during his national address on Tuesday.
The finance minister, who was flanked by the MoS Anurag Thakur and the finance ministry officials, said that the Aatmanirbhar Bharat rests on five pillars: Economy, Infrastructure, Technology-driven systems, Demography, and Demand. The focus will be on factors of production: Land, Labour, liquidity, and Laws. The intention is to make local brands global.
Key Takeaways: Six major steps for the revival of the MSME sector 1. Collateral free loan of Rs 3 lakh crores for MSMEs. This will benefit 45 lakh units so that they can resume work and save jobs. 2. For stressed MSMEs, the Subordinate debt provision of Rs 20,000 cr has been announced for 2 lakh MSMEs. It will benefit those who are NPAs or stressed MSMEs. 3. Rs 50,000 crore equity infusion through Mother fund-Daughter fund for MSMEs that are viable but need handholding. A fund of funds with a corpus of Rs 10,000 crore will be set up to help these units expand capacity and help them list on Markets if they choose.
4. The definition of MSMEs has been revised to allow MSMEs to aim for exp ansion and not lose benefits. Also, there'll be no distinction between the manufacturing & services sector MSMEs.