Finance Minister Nirmala Sitharaman has announced the final tranche of the stimulus economic package on Sunday. The announcement comes with a number of measures, which are mainly structural in nature, & aimed to create a conducive environment for businesses via ‘ease of doing business’.
The economic measures of the 5th tranche includes an additional Rs 40,000 crore for the rural jobs guarantee programme, a year-long waiver in fresh insolvency filings, relaxation in compoundable offences under Companies Act & additional funds allocated to the states for healthcare and containment efforts.
Highlights of Sitharaman’s announcements of the fifth & final tranche of the Rs 20 lakh crore economic package:
- For providing employment boost, additional Rs 40,000 crore allocations for MGNREGS are done.
- There will be increase in public expenditure on health.
- Ramp up health centres in rural & urban areas for any future pandemics.
- Suspension of fresh initiation of insolvency proceedings up to 1 year
- Threshold to initiate insolvency proceedings raised to Rs 1 crore from Rs 1 lakh
- Decriminalisation of Companies Act violations involving minor technical defaults
- At least one enterprise in strategic sectors but private sector to be allowed
- Govt opens all sectors to private companies, while public sector enterprises to play role in defined areas
- Most of compoundable offences sections to be shifted to internal adjudication mechanism
- Allowed direct listing of securities by Indian firms in permissible foreign markets
- PSEs to be privatized in non-strategic areas; timing to be based on feasibility etc
- State borrowing limit raised to 5% from 3% for FY’21; to unleash Rs 4.28 lakh crore
- Total stimulus package stands at Rs 20,97,053 crore, including RBI’s liquidity measures of Rs 8,01,603 crore since February 2020
- Announced Rs 1,92,800 crore schemes including Rs 1.70 lakh crore PM Garib Kalayan Yojana (PMGKY) in March
- Part of the enhanced state borrowing to be linked to specific reforms