Atma Nirbhar Bharat Abhiyan, towards a Self Reliant Nation

Highlight of Phase 1 Stimulus Package announced by Finance minister, Ms. Nirmala Sitharaman on 13 May 2020.

This Stimulus package is for spur Growth & Become self Reliant.

The 5 pillars of production are:

  1. Economy ,
  2. Infra ,
  3. Tech Driven System ,
  4. Demography ,
  5. Demand.

The focus here is gradual increase in Ease of doing Business

A Stimulus package of Rs. 20 lac crs out of which Liquidity created so far is as follows:

A. RBI had given 5.74 lac crs

B. Finance Min 1.7 lac crs

The new reforms made for Atmanirbhar Bharat Abhiyan:

  1. Tax Relief
  • Income Tax filling for the year 2019-20 dates has been extended from 31st July 2020 to 31st Oct 2020. New extended dates for tax audit and date of assessment as well.
  • Reduced TDS / TCS rates by 25% till March 31 2021. It will create Rs.50000 crs liquidity
  1. Under Pradhan Mantri Garib Kalyan Package (PMGKP), payment of 12% of employer and 12% employee contributions was made into EPF accounts of eligible establishments.
  • This was provided earlier for salary months of March, April and May 2020
  • This support will be extended by another 3 months to salary months of June, July and August 2020
  • This will provide liquidity relief of Rs 2500 cr to 3.67 lakh establishments and for 72.22 lakh employees.
  1. NBFCs/HFCs/MFIs are finding it difficult to raise money in debt markets. Special liquidity scheme
  • Under this scheme investment will be made in both primary and secondary market transactions in investment grade debt paper of NBFCs/HFCs/MFIs
  • Will supplement RBI/Government measures to augment liquidity • Securities will be fully guaranteed by GoI
  • This will provide liquidity support for NBFCs/HFC/MFIs and mutual funds and create confidence in the market Partial credit guarantee scheme .
  • Existing PCGS scheme to be extended to cover borrowings such as primary issuance of Bonds/ CPs (liability side of balance sheets) of such entities .
  • A paper and below including unrated paper eligible for investment (esp. relevant for many MFIs)
  • This scheme will result in liquidity of Rs 45,000 crores
  1. Under Atma Nirbhir Bharat Abhiyan Six measures are announced for MSMEs
  • 3 lakh crs loans for MSMEs with 100 crs Turnover with loan tenure of 4 years with monotorrium of 12 months period (collateral free loan) Hence 45 lakh MSMEs can benefit via 3lakh crs
  • No Global Tender for Govt Procurement Upto Rs.200 crs
  • Stress & NPA MSMEs will get Debt based solution of Rs.20000 crs. Therefore 2 lac stressed MSMEs will be benefit out of this
  • Fund of Fund for MSEMs Rs.50000 crs of Equity infusion. Which MSEMs had capacity to do well will be benefit out of this
  • New definition for MSMEs
  • Within Next 45 days Government will clear all dues of MSEMs
  1. Under Atmanirbhar Bharat RBI has given relaxation to bank regarding cash reserve ratio to enhance liquidity . Introduced Targeted long term repo operation of 1,00,050 crore for fresh deployment in various investment grade corporate bonds bonds, commercial paper, and non-convertible debentures. Atmanirbhar bharat has brought special relief to NABARD , SIDBI , NHB and also NBFCs AND MFIs