Finance Minister (FM) announces the comprehensive economic packages for the form and strengthen seven sectors under Atma Nirbhar Bharat Abhiyaan (Self-reliant India Movement). Atma Nirbhar Bharat will increase domestic production and boost India's position in global supply chain without affecting globalisation norms. The new concept 'Atma Nirbhar Bharat' is an out come of COVID-19 Crisis (It announced by Prime Minister on 12th May 2020).
4. Ease of Doing Business through IBC :
Due to covid-19 crisis, the defaulters excluded under IBC and there will be no fresh insolvency proceeding initiated up to 1 years. A special insolvency framework for MSMEs are notified under section 240A of the IBC.
Minimum threshold to initiate insolvency proceedings has been raised to Rs. 1 crore (from Rs. 1 lakh, which largely insulates MSMEs). This will broadly insulate MSMEs the minister said.
5. Decriminalisation of Companies Act defaults :
Decriminalization of Companies Act violations involving minor technical and procedural defaults such as shortcomings in CSR reporting, inadequacies in Board report, filing defaults, delay in holding of AGM. The amendment will de-clog the criminal courts and NCLT. 7 compoundable offences altogether dropped and 5 to be dealt with under alternative framework.
6. Ease of Doing Business for Corporate :
To improve in 'starting a business' and 'insolvency resolution' have contributed to overall improvement in India's ranking on EoDB.
* Direct listing of securities by Indian public companies in permissible foreign jurisdiction.
* Private company which list NCDs on stock exchanges not to be regarded as listed companies.
* Including the provision of part IXA (Producer Companies) of companies Act, 1956 in companies Act, 2013.
* Power to create additional / specialised benches for NCLAT.
* Lower penalties for all default for small companies, one person companies, producer companies and Start Ups.
7. Public Sector Enterprises Policy for a New, Self-reliant Infia :
* From few decades India and the world have changed.
* Need of new Policy - where all sectors are open to the private sector while public sector enterprises (PSEs) play an important role in in defined areas.
Government announced new policy -
+ Non strategic public sectors companies are allowed disinvestment.
+ In strategic sector, public sector and private sector allowed.
+ In other sectors, PSEs will be privatised. (Depending on time).
+ To minimise wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four, others will be privatised/ merged/ brought under holding companies.
8. Support already extended to State Governments :
* Centre as well as States have faced a sharp decline in revenues.
* Centre has consistently extended generous support to States in this time of need -
+ Devolution of taxes from Budget Estimates (in April), despite this revenue shows unprecedented decline from Budget Estimates.
+ Revenue Deficit Grants to States (Rs. 12,390 cr) given on time in April and May, despite Center stressed resources.
+ Advance release of SDRF (Rs. 11,092 cr) funds in first week of April.
+ Release of over Rs. 4,113 crore from Health Ministry for direct anti-Covid activities.
+ At Centre's request, RBI has increased
_Ways and Means Advance limits of States by 60%.
_ Number of days state can be in continuous overdraft from 14 days to 21 days.
_ Number of days state can be in overdraft in quarter from 32 to 50 days.
* Supporting state governments and promoting state level reforms for the sustainability of GSDP growth and lower deficit.
* Promote Welfare of migrants and reduce leakage in food distribution.
* Opening more Investment Program to increase job opportunities.
* Provide safeguard to the farmers.
* Promote Urban Development, health and sanitation.
* Reforms linkage will be in 4 areas : universalisation of 'One Nation One Ration Card', Ease of doing business, power distribution and urban local body revenues.
* Department of expenditure on the following patterns for notified schemes are -
+ Unconditional increase of 0.50%.
+ 1% in 4 trenches of 0.25%, with each tranche linked to clearly specified, measurable and feasible reform action.
+ Further 0.50% if milestone are achieved in at least three out of four reform areas.
The Finance Minister concluded by providing breakup of the economic assistance measures provided so far in order to become Atma Nirbhar Bharat (self-reliant India).
The economic package is equivalent to 10% of India's GDP (Rs. 20 lakh crore) in 2019-20. Atma Nirbhar Bharat package will resolve the issues of land, labour, liquidity and laws. The crisis and challenges is an opportunity to build a Self-reliant India.
Finance Minister said, number of of packages already functioning after lockdown like Pradhan Mantri Garib Kalyan Yojana (PMGKY), free food grains, cash payment to women & poor citizens and farmers etc. Around 41 crore poor people received financial assistance of Rs. 52608 crore under the PMGKY with the use of Direct Benifits Transfer (DBT) technology.
7 - Key Sectors Government Reforms and Enablers :
Seven measures for providing employment, support to business, Ease of doing business, and State Governments as well sectors such as Education and Health.
1. MGNREGA :
Government will allocate an additional Rs. 40,000 crore in MGNREGA. It will help to increase employment in rural area for migrant workers in monsoon season as well (generate nearly 300 crore person in days for work). These workers will build durable and livelihood assets and boost rural economy through higher production.
2. Health Reforms & Initiatives :
Finance minister said that public expenditure on health will be increased. To increase investment in grasd roots health institutions and strengthening health wellness centres in rural and urban areas. Establishing Infectious Disease Hospital Blocks in all districts and develop Public Health Labs network in all districts and blocks to manage pandemics. Integrated Health System by National Digital Health Blueprint under the National Digital Health Mission.
Already announced Rs. 15, 000 crore for Health.
IT use in Health :
* Roll out of e-Sanjeevani Tele-Consultation Service.
* Capacity Building : Virtual learning modules - iGOT platform.
Arogya Setu App : for self assessment and contact tracing.
Protection to Health Worker :
* Amendment in Epidemic Disease Act
* Adequate provision for PPEs -
+From Zero to > 300 domestic manufacturers.
+Already supplied - PPEs (51 lakhs), N95 masks (87 lakhs) HCQ tablets. (11.08 Cr).
3. Education :
Education will become technology based through DIKSHA. PM eVIDYA, a programme for multimode access to digital education to be launched immediately. There will be One TV channel for class 1-12 students and there will be use of radio, community radio & podcasts, special e-content for the visually & hearing impaired students.
Manodarpan, an initiative for mental emotional support to students, teachers and family launched immediately as well. National Foundational Literacy and Numeracy Mission for ensuring that every child attain Learning levels and outcomes in grade 5 by 2025 will be launched by December 2020.
Already announced Rs. 15, 000 crore for Health.
IT use in Health :
* Roll out of e-Sanjeevani Tele-Consultation Service.
* Capacity Building : Virtual learning modules - iGOT platform.
Arogya Setu App : for self assessment and contact tracing.
Protection to Health Worker :
* Amendment in Epidemic Disease Act
* Adequate provision for PPEs -
+From Zero to > 300 domestic manufacturers.
+Already supplied - PPEs (51 lakhs), N95 masks (87 lakhs) HCQ tablets. (11.08 Cr).
3. Education :
Education will become technology based through DIKSHA. PM eVIDYA, a programme for multimode access to digital education to be launched immediately. There will be One TV channel for class 1-12 students and there will be use of radio, community radio & podcasts, special e-content for the visually & hearing impaired students.
Manodarpan, an initiative for mental emotional support to students, teachers and family launched immediately as well. National Foundational Literacy and Numeracy Mission for ensuring that every child attain Learning levels and outcomes in grade 5 by 2025 will be launched by December 2020.
4. Ease of Doing Business through IBC :
Due to covid-19 crisis, the defaulters excluded under IBC and there will be no fresh insolvency proceeding initiated up to 1 years. A special insolvency framework for MSMEs are notified under section 240A of the IBC.
Minimum threshold to initiate insolvency proceedings has been raised to Rs. 1 crore (from Rs. 1 lakh, which largely insulates MSMEs). This will broadly insulate MSMEs the minister said.
5. Decriminalisation of Companies Act defaults :
Decriminalization of Companies Act violations involving minor technical and procedural defaults such as shortcomings in CSR reporting, inadequacies in Board report, filing defaults, delay in holding of AGM. The amendment will de-clog the criminal courts and NCLT. 7 compoundable offences altogether dropped and 5 to be dealt with under alternative framework.
6. Ease of Doing Business for Corporate :
To improve in 'starting a business' and 'insolvency resolution' have contributed to overall improvement in India's ranking on EoDB.
* Direct listing of securities by Indian public companies in permissible foreign jurisdiction.
* Private company which list NCDs on stock exchanges not to be regarded as listed companies.
* Including the provision of part IXA (Producer Companies) of companies Act, 1956 in companies Act, 2013.
* Power to create additional / specialised benches for NCLAT.
* Lower penalties for all default for small companies, one person companies, producer companies and Start Ups.
7. Public Sector Enterprises Policy for a New, Self-reliant Infia :
* From few decades India and the world have changed.
* Need of new Policy - where all sectors are open to the private sector while public sector enterprises (PSEs) play an important role in in defined areas.
Government announced new policy -
+ Non strategic public sectors companies are allowed disinvestment.
+ In strategic sector, public sector and private sector allowed.
+ In other sectors, PSEs will be privatised. (Depending on time).
+ To minimise wasteful administrative costs, number of enterprises in strategic sectors will ordinarily be only one to four, others will be privatised/ merged/ brought under holding companies.
8. Support already extended to State Governments :
* Centre as well as States have faced a sharp decline in revenues.
* Centre has consistently extended generous support to States in this time of need -
+ Devolution of taxes from Budget Estimates (in April), despite this revenue shows unprecedented decline from Budget Estimates.
+ Revenue Deficit Grants to States (Rs. 12,390 cr) given on time in April and May, despite Center stressed resources.
+ Advance release of SDRF (Rs. 11,092 cr) funds in first week of April.
+ Release of over Rs. 4,113 crore from Health Ministry for direct anti-Covid activities.
+ At Centre's request, RBI has increased
_Ways and Means Advance limits of States by 60%.
_ Number of days state can be in continuous overdraft from 14 days to 21 days.
_ Number of days state can be in overdraft in quarter from 32 to 50 days.
* Supporting state governments and promoting state level reforms for the sustainability of GSDP growth and lower deficit.
* Promote Welfare of migrants and reduce leakage in food distribution.
* Opening more Investment Program to increase job opportunities.
* Provide safeguard to the farmers.
* Promote Urban Development, health and sanitation.
* Reforms linkage will be in 4 areas : universalisation of 'One Nation One Ration Card', Ease of doing business, power distribution and urban local body revenues.
* Department of expenditure on the following patterns for notified schemes are -
+ Unconditional increase of 0.50%.
+ 1% in 4 trenches of 0.25%, with each tranche linked to clearly specified, measurable and feasible reform action.
+ Further 0.50% if milestone are achieved in at least three out of four reform areas.
The Finance Minister concluded by providing breakup of the economic assistance measures provided so far in order to become Atma Nirbhar Bharat (self-reliant India).
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