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  • FM Sitharaman unveils structural reforms for 7 sectors in 5th tranche of Atma Nirbhar Bharat package

    Published on May 17, 2020

    Finance Minister Nirmala Sitharaman unveiled the final tranche of financial stimulus and policy measures for various sectors to help build a self-reliant India under the Atma Nirbhar Bharat Campaign, today.

    Prime Minister Narendra Modi had on Tuesday in his address to the nation announced a special economic package equivalent to 10 per cent of India’s GDP, amounting to Rs 20 lakh crore.

    Addressing a media briefing in New Delhi, Finance Minister in her announcement of the fifth tranche of measures to address the economic situation in the country amid COVID-19, outlined structural reforms with focus on seven areas of  MNREGA, Health and Education, Business during COVID, Decriminalisation of Company Act, Ease of doing business, Policy related to Public Sector Units, State government and resources related to it.

    Announcing the relief measures of fifth tranche, Nirmala Sitharaman said, under the MNREGA scheme, an additional Rs 40 thousand crore will be allocated for employment generation in the rural parts of the country. She said, this will help to generate nearly 300 crore person days to provide relief to the migrant workers.

    In another major announcement, Ms. Sitharaman said that policy aimed at allowing private players in all sectors was the need of the hour and the government will chalk out a coherent policy for the same. She asserted that at least one Public Sector Enterprise (PSEs) would continue to remain in every strategic sector even after allowing private companies. Finance Minister added that the maximum number of enterprises in strategic sectors will be limited to four. She informed, the government will soon notify the list of strategic sectors requiring the presence of PSEs.

    On the support extended to the State Government, Finance Minister said, more than Rs 46 thousand crore have been devolved in April and revenue deficit grants of more than 12 thousand crore in April and May have also been given to the states despite centre’s stressful resources.

    Ms. Sitharaman highlighted government’s decision to increase the net borrowing ceiling for the states from 3 per cent to 5 per cent of the Gross State Domestic Product, which would result in increased resources of Rs 4 lakh 28 thousand crore for them. She said, more than Rs 11 thousand crore have been released to the states as advance from State disaster relief fund in the first week of April and Ministry of Health and Family Welfare released another Rs 4 thousand 113 crores for direct anti-COVID activities.

    On the Health reforms and initiatives taken to fight the COVID-19 pandemic, she said, public expenditure will be increased and Health and Wellness Centres in rural and urban areas will be ramped up. She said, infectious diseases hospital blocks and integrated public health labs will be set up in all districts to handle such pandemic like situation in the country. Ms. Sitharaman said, National Digital Health blueprint will be implemented under the National Digital Health Mission.

    In a major relief to the MSMEs, Finance Minister announced a substantial hike in the minimum threshold to initiate insolvency proceedings. The threshold which was earlier Rs one lakh  has now been increased to Rs one crore which will insulate a large number of MSMEs in the country from insolvency proceedings against them.

    She also announced special insolvency resolution framework for MSMEs which will be notified soon. Ms. Sitharaman also informed that no fresh insolvency proceedings will be initiated upto the next one year and COVID-19 related debts will not be considered as default payments for proceedings under the Insolvency and Bankruptcy Code.

    Finance Minister said, PM-e-Vidya programme for multi mode access to digital online education will be launched shortly which will consist of e-content and QR coded textbooks for all grades. She said, one TV channel per class from 1 to 12 will be operated and extensive use of Radio and Community Radio will be encouraged. She said, top 100 universities will be permitted to automatically start online courses by 30th of this month. She also announced, an initiative by the name of ‘Manodarpan’ which will be launched for psychological support of students, teachers and their family for mental health and emotional well being.

    Speaking over, decriminalization of companies act, she said, violation involving minor technical and procedural default will not be accounted which in turn will help to de-clog the criminal courts and NCLT. Finance Minister highlighted that, the improvement in rankings in starting a business and in terms of insolvency resolutions have together contributed to an overall improvement in India’s ranking in Ease of Doing Business. She added that the further reforms will include Indian public companies being able to directly list securities in permissible foreign jurisdictions.

    Referring to Prime Minister Narendra Modi’s address, Finance Minister said, government is working with the targeted approach to provide the benefits to the people belonging to all strata of the society. She said, under the Prime Minister Garib Kalyan package, free food grains were provided to 80 crore people and under the PM Kisan Yojana more than Rs 16 thousand crore have been given to the 8.19 crore people through direct benefit transfer.

    She said, more than Rs 10 thousand crore were released to 20 crore Jan Dhan accounts of women and construction workers got Rs 3 thousand 950 crore.  She said, 6.81 crore beneficiaries got the cylinder under the Ujjawala scheme and 12 lakh EPFO holders have withdrawn the advance amount. She said, Shramik Special trains were operated for the migrant workers and 85 per cent of the cost was borne by the Central Government.

    Earlier on Wednesday, the Finance Minister announced a slew of measures to help the Micro, Small and Medium Enterprises, MSMEs sector that employs an estimated 11 crore people. The announcements ranged from Non-Banking Finance Companies (NBFCs), real estate, power distribution sector, to relaxations on contribution to Employees’ Provident Fund (EPFO).

    In her second announcement on Thursday the focus was on migrant workers, street vendors, small traders, the self-employed and small farmers.

    Third announcement saw major relief packages for agriculture and allied activities, while yesterday key sectoral reforms were announced in the sectors of coal, minerals, defence production, civil aviation, power distribution companies, space sector and atomic energy.