Union Finance Minister Nirmala Sitharaman's fourth tranche of economic package is largely devoted to policy and structural reforms in key sectors including power, coal, defence and aircraft MRO.
The Union Minister made a slew of announcements on Wednesday , Thursday and Friday .
Here are the live updates:
Union Finance Minister Nirmala Sitharaman concluded her press conference by saying "The final tranche of the stimulus package will be announced in an 11 am briefing tomorrow."
Atomic energy:
So far, atomic energy is entirely in govt hands. Now private involvement to be brought into certain areas through PPP mode. Research reactor to be set up in PPP mode for production of medical isotopes which can be used for treatment of cancer and other diseases.
Irradiation technology facilities for food preservation to be set up in PPP mode, to assist farmers.
Indian start-ups and tech entrepreneurs will be linked up with nuclear research facilities through tech development-cum-incubation centres to foster synergies.
Space:
ISRO has brought India many laurels, but want to create level playing field for private players in the satellites, launches and space-based services. Govt will provide predictable policy and regulatory environment, and allow private sector to use ISRO facilities.
Future projects for travel in outer space or exploration of new planets will be open to the private sector.
Govt will ease geo-spatial data policy to make such remote-sensing data more widely available to tech entrepreneurs, with safeguards put in place.
Creation of social infrastructure projects and promotion of private investment through viability gap funding, which is being increased from 20% to 30%.
Total outlay is Rs. 8,100 crore.
Power distribution companies in union territories shall be privatised, says the Finance Minister.
Tariff policy reforms to protect consumer rights, so that inefficiency of discoms will not burden the consumer.
Load shedding will be penalised. There will be a progressive reduction in cross subsidies.
Smart prepaid meters to be set up and subsidies paid by direct benefit transfer.
Civil aviation
Only 60% of Indian airspace is freely available. There is a need to ease restrictions to make civilian flying faster and more efficient. We will bring benefit of Rs. 1000 crore per year. It will save pilot and passenger travel time, aviation fuel and have positive environmental benefits, says Finance Minister Nirmala Sitharaman.
Six more airports are up for auction on PPP basis by Airports Authority of India.
Additional investment by private players to be invited in 12 airports, which is expected to net Rs. 13,000 crore for AAI.
To make India a global hub for aircraft maintenance, report and overhaul (MRO) hub, the tax regime for MRO ecosystem is being rationalised. This will save maintenance cost for airlines, allow convergence between defence and civil aviation MROs. The target is to grow MRO market in the country from Rs. 800 crore to Rs. 2000 crore over three years.
Ordnance Factory Boards are being corporatised to improve professional management, transparency and accountability, says Ms. Sitharaman.
They will be listed on the stock market. This is not the same as privatisation, they will not be privatised, she clarifies.
FDI limit in defence manufacturing under automatic route will be raised from 49% to 74%.
Reforms to ensure faster decision making in defence procurement by setting realistic quality requirements, setting up a contract management unit, and overhauling trial and testing procedures.
Defence production
The Finance Minister lists out reforms in the defence sector.
Make in India is absolutely necessary for self-reliance, especially wherever possible in critical sectors like defence production, she says.
"We shall notify list of weapons and platforms not allowed for import. They will have to be bought in India. Every year, this list will be increased as capacity to make weapons that meet necessary standards grows. Indigenisation of some imported spares will also be given priority," she says.
There will be separate budget provision for domestic capital procurement. This will help reduce defence import bill and also encourage domestic manufacturing, says Ms. Sitharaman.
Composite regime for minerals
Government is announcing composite exploration-cum-mining-cum-production regime for minerals. Under the regime, 500 mining blocks will be offered through open and transparent auction process.
Bauxite and coal blocks will be auctioned jointly.
Distinction between captive and non-captive mines will be removed to allow transfer of mining leases and sale of surplus unused mineral blocks, says the Finance Minister.
Reforms in coal sector
Now any private player can bid for a coal block and sell it in the open market. Earlier, only captive consumers with end-use ownership could bid for coal blocks. Almost 50 blocks will be offered immediately, the Finance Minister says.
Govt is also providing incentive to convert coal into gas in order to meet environmental needs. Coal bed methane extraction also will be done through auction, she adds.
Infrastructure development financing of Rs. 50,000 crore will be provided to support 1 billion tonnes of coal from Coal India by 2023-24, plus coal from private blocks.
Empowered Group of Secretaries to fast track clearances
Policy reforms to fast track investment include fast track clearances through an Empowered Group of Secretaries, and incentive schemes to promote new champion sectors. Schemes will also be implemented in States through challenge mode to upgrade infrastructure facilities and connectivity in industrial clusters, and to make available land for new investments, says Nirmala Sitharaman.
Reforms are planned in the following sectors: coal, minerals, defence production, airspace management, airports, MRO, power distribution companies in union territories, space and atomic energy, she says.
We are bringing in commercial mining in coal sector. The government monopoly in coal is being removed, says the Finance Minister. Revenue sharing mechanism will allow for more coal availability at competitive market prices.
Structural reforms
Focus of today's announcements will be on structural reforms in sectors that are going to be the new horizons for growth, to lead to more investment, production and employment generation, says Union Finance Minister Nirmala Sitharaman.
Many sectors need policy simplification and once we decongest these sectors, they can become competitive enough to boost growth and employment, she says.
First leg of announcement focussed MSMEs
Prime Minister Narendra Modi, in his address to the nation on May 12 , announced a ₹20-lakh-crore special financial package — nearly 10% of India’s GDP.
Following this, the Finance Minister on Wednesday announced a ₹3 lakh crore collateral free loan scheme for businesses, especially micro, small and medium enterprises (MSMEs), as part of a ₹20-lakh-crore economic stimulus package to deal with the COVID-19 pandemic .
For salaried workers and taxpayers, some relief was provided in the form of an extended deadline for income tax returns for financial year 2019-20, with the due date now pushed to November 30, 2020. The rates of tax deduction at source (TDS) and tax collection at source (TCS) have been cut by 25% for the next year, while statutory provident fund (PF) payments have been reduced from 12% to 10% for both employers and employees for the next three months.
Second announcement for migrants
A major focus of the second tranche of the economic stimulus package announced on Thursday was to provide free foodgrains for the next two months to migrant workers who do not have ration cards. The Centre will spend ₹3,500 crore for this purpose.
Apart from measures for migrant workers, the second tranche announced by the government included an extension of credit facilities for urban housing, street vendors and farmers and an interest subvention scheme for small businesses.
Third announcement on agri-marketing reforms
Making long-pending agricultural marketing reforms the centrepiece of the third tranche of the Atmanirbhar Bharat Abhiyan economic stimulus package, Union Finance Minister Nirmala Sitharaman on Friday announced plans to enact a central law to permit barrier-free inter-State trade of farm commodities and ensure a legal framework to facilitate contract farming.
The third tranche also included plans to invest ₹1.5 lakh crore to build farm-gate infrastructure and support logistics needs for fishworkers, livestock farmers, vegetable growers, beekeepers and related activities, although this includes some previously budgeted money and extensions of existing schemes.
₹1.70 lakh crore package for the poor
In the last week of March, Ms. Sitharaman announced a Rs. 1.70 lakh crore package which is likely to benefit 80 crore people.
Under the Pradhan Mantri Gareeb Kalyan Yojana for next three months, each person will get additional 5 kg wheat or rice for free, in addition to 5 kg per month already given under PDS. One kg of pulses will be provided per household, according to regional preferences.
