Our Finance Minister, Nirmala Sitharaman, addressed India’s massive Rs.20 lakh crore budget amount announced by our honorable Prime Minister Narendra Modi on May 13. The Prime Minister of India has published this budget on May 12 through press meet. This package is almost 10% of India’s gross domestic product(GDP). This decision has been taken due to the vast economic imbalance that has been happening in the country due to covid-19 and its consequences that lead to almost 50 days’ lockdown in the country. So our Finance Minister addressed everyone to explain this budget in detail the sector-wide distribution and other measures in the economic relief package.
She mentioned that this budget is mainly to spur growth and to build a very self-reliant India. This whole initiative is called as ‘Atmanirbhar Bharat Abhiyan’. This initiative will be resting and is built on five essential pillars which consist of Economy, Infrastructure, System, Vibrant Demography, and Demand. Atmanirbhar Bharat focus would be on land labour, liquidity, and law. The package mainly concentrates on catering to various sections including cottage industry, MSMEs, labourer’s, middle class, commerce, among others. The main intention is to take local brands and build them to the Global level. Bold reforms across sectors will drive the country’s push towards self-reliance. It is time to become vocal about our local products and make them global. The name does not mean an isolated India, but it illustrates a confident India which can rest on its strengths and also it can contribute to the Global.
Our Finance Minister Nirmala Sitharaman also mentioned a new definition to MSME. A low threshold to MSME definition has created a fear among MSME of graduating out of the benefits and hence killing the urge to grow. There has been a long-pending demand for revisions. Now investment limit that usually defines an MSME will be revised upwards. Additional criteria for turnover also being introduced. There will be no discrimination between the manufacturing sector and the service sector. For government procurement tender up to 200 crores will no longer be on the global tender route.
She has announced collateral-free loans for MSME up to Rs 3 lakh crore. For the stressed MSMEs, she further announced Rs 20,000 crore liquidity to benefit around 2 lakh MSMEs. Stressed and NPA MSMEs will be eligible for this facility. FinMin has also decided to infuse capital of Rs 50,000 crores in MSMEs for their expansion. E-market linkage is provided across the globe for all these MSME’s so that they can find their market easily in the absence of being able to participate in trade fails which cannot be held in this environment. The government has been continuously monitoring settlement of dues to MSME vendors from Government and Central Public Sector Undertakings. Within the next 45 days, the CPSEs and government of India will honour every MSME receivable.
The next point that has been addressed is about the EPF in which units that are under workers, 90% of whom are earning less than 15000 rupees will be able to draw from their EPFs because they needed money in their hands. The government has already declared that for three months the payment of EPF was also given relaxation. And now liquidity relief is being provided for all the EPF establishments. In this 12% paid by the employer and 12% by the employee contribution. The support that the government of India gave has been extended for another three months.
As of now, it is carried until May 2020, but now it has been extended until August 2020. The payments have been made to their eligible accounts by the government of India for March, April, and May. Nearly 3.6 lakh establishments benefited from this. Liquidity relief of 2500 crores to 72.22 lakh employees is now being proposed to be provided by extending this contribution for the next three months also, i.e. June, July, August. The EPF contribution will be paid by the government of India, and this shall provide 2500 crore liquidity support. Through this broad support will be given to Employees, and they will be benefited.
All pending refunds to charitable trusts and non-charitable businesses and professions including proprietorship, partnership, LLP, and co-operatives shall be issued immediately. A tax audit will be conducted from September 30, 2020, to October 31, 2020. Date of assessments getting barred on September 30, 2020, extended to December 31, 2020, and those getting banned on March 31, 2021, will be extended to September 30, 2021. Period of Vivad se Vishwas Scheme for making payment without additional amount will be extended to December 31, 2020. Let us hope India to be a self-reliant economic powerhouse in the decade to come.