Self reliant India: FM briefs media on Rs 20 lakh crore economic package

Mumbai: Prime Minister Narendra Modi on Tuesday announced a Rs 20 lakh crore package, worth 10 percent of India’s GDP in order to revive the economy.

Stressing on self reliance as India moves ahead in the post Covid world Modi said that the package, which combined the government’s recent announcements on supporting key sectors as also measures rolled out by the Reserve Bank of India will address problems of a wide range of sectors as well as difficulties of the migrant workers.

Briefing reporters on the details of the package, Sitharaman said that the prime minister has laid out a comprehensive vision following discussions with various ministries and stakeholders. The package is aimed at spurring growth and building a self reliant India.

The process of building self reliant India will be based on five pillars – economy, infrastructure, technology driven system, vibrant demography and the demand-supply chain. The focus will be on factors of production essentially land, labour and law.

Sitharaman listed out various reforms brought by the Modi government such as Swach Bharat Abhiyan, FDI liberalisation, GST, ease of doing business, power sector reforms etc including the DBT, PM Kisan Yojana which enabled transfer of monetary benefits announced by the government during the lockdown.

Citing Modi’s appeal to ‘Buy local, Be vocal’, Sitharaman said that the package will focus on strengthening the local industries. She however stressed that this did not imply that India will isolate itself.

PM Garib Kalyan Package was announced soon after the lockdown. The RBI also took measures to ensure liquidity in the market.

This is the first of a series of meetings starting today, said Sitharaman adding that 15 initiatives will be taken in the first tranche being announced today.

Six steps of the 15 being announced today are aimed at boosting the MSMEs. This includes:

1. Rs 3 lakh collateral free loan for MSME. Tenure of 4 years and no principal repayment in the first year
2. Rs 20,000 cr subordinate debt for stressed MSMEs to address their equity problem
3. Fund of Funds with corpus of Rs 10,000 cr aimed to infuse capital for MSMEs that have potential
4. Definition of MSMEs being changed – Investment limit that defined MSME is being revised upwards; Addl criteria to define MSME, based on turnover is being brought in; Differentiation between manufacturing and service MSME being removed
5. Global tenders to be discontinued for govt procurement upto Rs 200 cr
6. Will ensure e-market linkages, receivables to be cleared in 45 days