India stimulus package: government tries to ease cash crisis and help small businesses restart | India Business News

NEW DELHI: One day after Prime Minister Narendra Modi announced a stimulus of Rs 20 lakh crore, the government released on Wednesday more than Rs 5.5 lakh crore package as the first installment of the “atmanirbhar (self-sufficient) campaign” with a focus on MSMEs (micro, small and medium enterprises), seen as key employers of unskilled, semi and skilled workers who have endured the brunt of the shutdown to fight against Covid-19. There were also measures for NBFC and real estate.
In the first set of announcements to run in the coming days, the finance minister Nirmala Sitharaman explained plans to provide liquidity small and medium-sized companies and also initiate reforms that would redefine the sector and encourage companies to get rid of their fears of “growing”, a change in the state that previously involved the loss of benefits available to the sector.
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The package focused largely on providing cash for the MSME sector, NBFC, housing finance companies, microfinance companies, as well as reducing taxes deducted at source and taxes levied at source rates to ensure more money in taxpayers’ hands. This will not apply to salaried individuals, but will assist contract payments and those who charge professional fees.
The centerpiece was automatic unsecured loans worth Rs 3 lakh crore for businesses and the MSME sector, which would help about 45 lakh units in the segment and potentially a few crore workers. TOI had accurately predicted the MSME measures in its Wednesday edition.

Boosting liquidity will empower entrepreneurs: PM Modi
The MSMEs sector has been hit hard by the pandemic and there have been continued calls for a curative touch that will help businesses to function and, most importantly, help prevent migrant workers from leaving cities due to the lack of income.
The definition of MSMEs was modified with an increase in the investment limit, as well as with the introduction of an additional rotation criterion. The FM said the government would amend the laws soon to implement the changes. Global tenders of up to Rs 200 million will also be rejected to help MSMEs get a share of the business and not lose the biggest players. “Today’s FM announcements will go a long way in addressing the problems facing companies, especially MSMEs. The announced steps will increase liquidity, empower entrepreneurs and strengthen their competitive spirit,” Modi said on Twitter.

The FM also announced a reduction in the provident Finance the contribution of employers and employees for the next three months and extend for three months the scheme introduced as part of Prime Minister Garib Kalyan Yojana under which the government contributes 12% of salary each on behalf of the employer and the employee to the EPF for those earning less than Rs 15,000 per month in units with less than 100 workers.
The extension will be for the salary months of June, July and August. Total cumulative benefits are approximately Rs 2.5 billion to 72.22 lakh employees.
“Essentially, the goal is to build a self-sufficient India, that is why the economic package is called‘ Atmanirbhar Bharat Abhiyan“The minister said. Pointing to Modi’s emphasis, Sitharaman said that the focus would be on land, work, liquidity and the laws.” Starting today, for the next few days, I will come here with the entire team of the finance ministry to detail the prime minister’s vision for atmanirbhar Bharat, “Sitharaman said at a press conference.