On 13th May 2020, the Prime Minister of our nation Mr. Narendra Modi announced the “Aatmanirbhar Bharat” package which proposes the people of the nation to become ” self-reliant” during this pandemic.
On the very next day, 14th May 2020 Finance Minister Mrs. Nirmala Sitharaman addressed the nation about the first trench of the Aatmanirbhar Bharat package which focused on the restoration of the MSME sector.
The Atmanirbhar Bharat stands on five pillars:
- Technology-driven systems
It was said that the main objective would be on labor, liquidity, land and law. The motive of Aatmanirbhar Bharat is to make local brands global. The Prime Minister in his speech clearly mentioned several times that the time has come to use our local brands over international brands.
There are some significant steps that would help in the revival of the MSME sector.
First, a collateral-free loan of about 3 crores has been announced for MSME which would help 45 lakh units which in turn could resume work and save jobs of many.
Second, For NPAs or stressed MSMEs a subordinate debt provision of the amount 20 crores has been sanctioned for 2 Lakh MSMEs.
Fourth, the description of MSME has been revised so that they aim for augmentation and not dissipate profits.
Fifth, global tenders will be forbidden up to 20 crores for government contracts from now on.
Sixth, the government will ensure that the e-market linkages are provided across the board in the absence of non-participation in trade fairs. Additionally, the government of India
Seventh, a liquidity relief of 2500 crores EPF support will be given to all EPF establishments and the EPF donation will be paid by the government of India for another 3 months till August and will avail more than 72 lakh employees.
Eighth, statutory EPF contribution for all the organizations and their employees covered by EPFO has been reduced to 10% from 12% and this doesn’t apply to any government organizations. This will introduce 6750 crore liquidity into these organizations.
Ninth, a special liquidity scheme of Rs.30,000 crore for investing in investment-grade debt paper of NBFCs, HFCs and MFI’s The NBFCs are also funding MSMEs.
Tenth, a partial credit guarantee scheme 2.0 for NBFCs has been initiated of amount 45,000 crores. The initial loss of 20% will be supported by the government of India.
Eleventh, a one-time contingency liquidity injection against all Discoms receivables will be initiated of Rs. 90,000 crore and will be backed by the states.
Twelfth, for about 6 months an extension will be provided by all Central Government Agencies: Railways, Central Public Works Department, Ministry of Road Transport and Highways.
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