Aatmnirbhar Bharat Package
On May 12, 2020, Prime Minister Narendra Modi announced a special economic and comprehensive package of Rs 20 lakh crore to fight the Covid-19 epidemic in India. It was said that this package is equivalent to 10% of India’s GDP. Where and how the money of such a big package will be spent, the demand for details of this is already there. Now the Finance Ministry has presented an account of it. The Ministries of Finance and Corporate Affairs had started implementing the announcements related to the economic package under the self-sufficient India campaign immediately. The progress made so far by the ministries in the implementation of the existing schemes of the self-sufficient India package is as follows…
1. An additional emergency working capital amount of Rs 30,000 crore for farmers through NABARD:
According to the statement released, Rs 25,000 crore has been disbursed till 28 August 2020. Under the Special Liquidity Facility (SLF), a balance of Rs 5000 crore was allocated to NABARD by RBI for small NBFCs and NBFC-MFIs. NABARD is finalizing operational guidelines to start it soon. Apart from this, NABARD has also started a ‘Structured Finance and Partial Guarantee Scheme’ in collaboration with two agencies and banks to help unbanked NBFCs / MFIs in getting loans from lenders.
This arrangement, co-created with two such agencies and banks, will increase the credit eligibility by 5-6 times for small MFIs which do not receive any rating. Once the entire Rs 500 crore earmarked for this scheme is used correctly, these small NBFCs / MFIs envisage loans ranging from Rs 2500 to 3000 crore. It will prove to be a game-changer in reaching the people of remote and inaccessible areas, especially women.
2. Partial Credit Guarantee Scheme of Rs 45,000 crore for NBFC, HFC and MFI to provide fresh loans to MSMEs and individuals 2.0:
According to the Finance Ministry statement, by August 28, 2020, banks have approved the purchase of portfolio worth Rs 25,055.5 crore and they are currently in the process of approval/negotiation for an additional Rs 4,367 crore.
3. A special liquidity scheme of Rs 30,000 crore for NBFC / HFC / MFI has also made good progress.
To implement the scheme, SBICAP was entrusted with the task of setting up an SPV. The scheme was launched through a press release issued on July 1, 2020. On the same day, the regulatory RBI also issued a circular to the NBFC and HFC on this scheme.
Till 11 September 2020, 37 proposals have been approved, including an amount of Rs 10590 crore. 6 applications are under process for funding 783.5 crores.
4. Guarantee-free automatic loan of Rs 3 lakh crore for businessmen including MSME:
To provide relief to the business, additional working capital finance equal to 20% of the outstanding loan will be provided as term loan at concessional rate of interest till 29 February 2020. It will be available to those units with accounts up to Rs 25 crore and those units having business up to Rs 100 crore. These units will not have to provide any guarantee or bail on their own behalf. 100% guarantee on this amount will be given by the Government of India, which will provide total liquidity of Rs 3 lakh crore to more than 45 lakh MSMEs.
After receiving cabinet approval on 20 May 2020, the Financial Services Department issued operational guidelines for the scheme on 23 May and registered the Emergency Credit Line Guarantee Scheme (ECLGS) Fund 26 May. The guidelines were amended on 4 August to include personal loans for business, raising the outstanding loan limit to Rs 50 crore and increasing the annual turnover limit to Rs 250 crore.
By September 10, 2020, an additional loan amount of Rs 1,63,226.49 crore has been sanctioned to 42,01,576 borrowers. An amount of Rs 1,18,138.64 crore has been disbursed to 25,01,999 borrowers till 10 September 2020. This information is given by the public sector banks and the top 23 private sector banks.
5. Income tax refund
Refunds worth more than Rs 1,01,308 crore have been issued to more than 27.55 lakh taxpayers between the period from 1 April 2020 to 8 September 2020. Income tax refunds of Rs 30,768 crore have been issued in 25,83,507 cases and corporate tax refunds of Rs 70,540 crore have been issued in 1,71,155 cases. In fact all corporate tax refunds up to Rs 50 crore have been issued in all those cases, wherever due. Other refunds are under process.
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