Union Finance minister Nirmala Sitharaman on Sunday addressed the press conference to announce the fifth and the last tranche of Rs 20 lakh crore stimulus package aimed to rescue country’s struggling economy which was severely affected by COVID-19 pandemic.
She announced measures under seven segments which were 1) MGNREGS, 2) Health – rural and urban, including education 3) Businesses and Covid-19 4) Decriminalization of Companies Act 5) Ease of doing business 6) State governments & resources related to state governments 7) Public sector enterprises.
Sitharaman said additional ₹ 40,000 crore will be allocated to MNREGS to create additional jobs in the rural sector as a lot of workers have gone back to their villages, this will ensure that those wishing to enroll into MNREGA can be provided jobs.
Under Companies Act Seven compoundable offences are being dropped and five offences to be dealt under an alternative framework. This will make the process simpler and enable resolution at the local level said the FM.
Also, compoundable offences can now be tried under an internal adjudication mechanism, will help de-congest criminal courts, which is absolutely important.
Securities now can be directly listed in foreign jurisdictions by companies. From now on, if companies list their non-convertible debentures in the stock market, they do not thereby become listed companies.
FM said health reforms and initiatives have been put in place, public health expenditure will be increased, grass-root investment to be increased for health and wellness centers in both rural and urban areas.
Further, Sitharaman added public health levels will be set up at block levels. Infectious disease hospital blocks will be set up in every district.
Public health labs to be set up in every block (not just in district), to bridge inadequacy of lab network in rural areas. Big emphasis on setting up hospitals and labs, with both public and private funding.
While country’s education system will see something new as PM eVidya programme, a multi-mode digital online learning education platform to be launched immediately.
Also, this will include DIKSHA, which is ‘one nation one platform’ facility, for school education. Each class to have 1 earmarked TV channel. Manodarpan – a programme for emotional and mental support to children and families – is being launched, under PM eVidya.
Special insolvency framework for MSMEs to be brought in. The minimum threshold for initiating solvency proceedings being raised from Rs 1 lakh to Rs 1 crore, a major step, will help insulate MSMEs, will bring in an ordinance for this.
Sitharaman said no fresh insolvency proceedings will be initiated up to one year. Debts related to Covid-19 shall not be considered under the category of defaults, under Insolvency and Bankruptcy Code.
Government to announce a new public sector policy and a list of strategic sectors requiring the presence of PSEs in the public interest will be notified. In strategic sectors, where public sector enterprises will be present, at least one & not more than 3 or 4 PSEs will be present, the private sector also allowed to participate.
Centre also decides to increase borrowing limits of states. FM said “The states have seen a sharp decline in the revenue, we have consistently extended help to the states.”
Revenue Deficit Grants to states of Rs 12,390 crores was given on time in April and May despite Centre’s stressed resources, devolution of taxes of Rs 46,038 in April given fully.
Sitharaman said states have so far borrowed only 14 per cent of the limit which is authorised to them. 86 per cent of the limit remains unutilised. Centre has decided to increase the borrowing limits of states from 3 per cent to 5 per cent of Gross State Domestic Product (GSDP) for 2020-21.
Till now here’s the further breakup of five tranches in total
· The stimulus of Rs 1,92,800 crore was given before the PM announced new economic package.
· The first tranche was amounting to Rs 5,94,550 crore.
· Stimulus provided in the second tranche was of Rs 3,10,000 crore.
· Rs 1,50,000 crores was extended in the third tranche.
· Package amounts to Rs 48,100 crore in the fourth and fifths tranches.
· Under the Atmanirbhar Bharat the overall stimulus package amounts to Rs 20,97,053 crore.