New Delhi: Addressing the nation on this Tuesday, Prime Minister Narendra Modi announced that the Rs 20 lakh crore stimulus packages would revive the economy and benefit all sections of society, from migrant workers to big business. He said the details of the package would be released by the Finance Minister in the coming days. The broader economic stimulus package will provide cash assistance to the poor, industry guarantees and far-reaching policy announcements for sectors such as agriculture, insurance, banking and power.
The package includes:
- Collateral free loan of Rs 3 lakh crores for MSMEs that have become unviable or are loan defaulters
- Subordinate debt provision of Rs 20,000 cr has been announced for 2 lakh MSMEs. Further, MSME receivables from the government and CPSEs will be released in the next 45 days.
- Global tenders will be disallowed up to Rs 200 crore for government contracts
- Both large and small industries will get the necessary support in terms of liquidity and working capital and the government will take the guarantee
- It is expected that the Small Industries Development Bank of India will be the nodal agency for micro, small and medium enterprises
- States may have more to say about economic planning and consolidation of financial institutions, but they need to reform, especially in the agriculture and power sectors, which are facing a severe problem of Rs 60,000 crore in DISCOM arrears. The first phase of the fiscal stimulus has primarily focused on MSMEs, which account for 35% of the GDP and contribute to one third of the exports.
“This package will give a new impetus to the country’s development journey in 2020 and give a new direction to the self-reliant India campaign. The package emphasizes land, labor, liquidity and the rule of law to prove India’s commitment to self-reliance”, the Prime Minister said on Tuesday.