In PM Narendra Modi’s address recently, it was mentioned that the Centre will release a Rs 20 lakh Crore economic package. Now, further details were shared by Nirmala Sitharaman, the Finance Minister.
The economic package will aim to make India self-reliant and trigger economic growth. The newly envisioned India will have 5 pillars.
These 5 pillars include ‘System, Infrastructure, Economy, Demography, and Demand’.
Amidst the crisis, the Finance Minister ensures that they will not neglect the needy, the poor, migrant workers, or the elderly.
They will provide automatic, collateral-free loans up to Rs 3 lakh crore that will have a 4-year tenor. This will be available for businesses, even SMEs until October 31st of this year.
It is believed that 45 lakh units will be able to reap the benefits of this plan.
While on the topic of SMEs, a subordinate debt of Rs 20,000 crore is to be provided to MSMEs. This way, an extra 2 lakh units will be benefitted.
In fact, the previous definition of an MSME has been re-defined. The investment limit has been revised to up to Rs 1 crore from the Rs 25 lakh earlier.
Additionally, a Special Liquidity Scheme has been introduced for microfinance companies, non-banking financial companies, and more. This is a scheme of Rs 30,000 crore.
As a serious crisis is facing electricity distribution companies, the government will try to better the situation. A Rs 90,000 crore liquidity infusion will be done for the power distribution companies.
Relief to contractors is also available as an extension of up to 6 months is provided by all Central agencies. This will come at no cost to the contractor.
The government has reduced the Tax Deduction at Source rate and Tax Collection at Source rate by 25% for taxpayers. This will come into effect from May 14 this year and last till March 21, 20201.
They’ve also extended the deadline for filing income tax returns and tax audits. The new deadlines are November 30, 2020, and October 31, 2020, respectively. Instead of paying them in taxes, this will release Rs 50,000 crore in the hands of people.
P Chidambaram, senior Congress leader, said the package is a “cruel blow dealt to those who toil every day”. According to him, this economic package does not provide any real benefit to the poor, or migrant workers even.
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Thomas Isaac, Kerala Finance Minister, is also not a fan of this plan. “If the first day’s package of Union FM is a fair sample the Rs 20 lakh stimulus is going to be deeply disappointing,” he adds.
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