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Modi announces Rs 20 lakh crore special economic package
By Surabhi Agarwal, Megha Mandavia, Priyanka Sangani
ET Bureau|Last Updated: May 13, 2020, 03.26 PM IST
The package is for our labourers, farmers, honest tax payers, MSMEs and cottage industry, Narendra Modi said.
India fights Covid-19: PM Modi announces Rs 20 Lakh Cr Atmanirbhar Bharat Abhiyan package
PM Narendra Modi announced a Rs 20-lakh-crore stimulus package, equivalent to about 10% of India’s GDP, aimed at making the country self-reliant and reviving the stalled economy. Details of the plan, dubbed the Atmanirbhar Bharat Abhiyaan, will be unveiled by finance minister Nirmala Sitharaman starting Wednesday, the Prime Minister said in his address to the nation on Tuesday evening.
The programme encompasses earlier packages announced by the government and the Reserve Bank of India, Modi said, adding that bold reforms are needed to make the country self-reliant so that crises such as the Covid-19 pandemic can be overcome in future.
“These reforms include supply chain reforms for agriculture, rational tax system, simple and clear laws, capable human resources and a strong financial system,” he said. “These reforms will promote business, attract investments, and further strengthen ‘Make in India’.”
The package will focus on land, labour, liquidity and laws, and will cater to various sectors including the cottage industries, micro, small & medium enterprises (MSMEs), the working class, middle class and industry, among others. He said the package will also focus on empowering the poor, labourers and migrant workers, both in the organised and unorganised sectors. It will seek to increase efficiency and ensure quality.
The government had announced a Rs 1.7 lakh crore stimulus plan on March 26. The Reserve Bank of India has also launched various programmes to help borrowers and boost liquidity, besides cutting interest rates to a record low.
Five Pillars for Self-Reliance
Last week, the government raised its gross market borrowing target for the current financial year to Rs 12 lakh crore from Rs 7.8 lakh crore estimated in the budget.
Self-reliance will prepare India for tough competition in the global supply chain, and it is important that the country should emerge victorious, he said. He said a selfreliant India will stand on five pillars — the economy, infrastructure, system, demography and demand.
India’s nationwide lockdown began on March 25 and is scheduled to stay in place until May 17, although there have been some relaxations since May 4. Modi said the government will provide details about the next phase, or Lockdown 4.0, before May 18. The contours of this will be different from those seen so far and new rules will be framed on the basis of recommendations by the states. Modi had held a video-conference with chief ministers on Monday.
“Several experts and scientists have said that the virus is going to be a part of our lives for a long time,” he said. “But it is also important to ensure that our life does not revolve only around it. People should work toward their targets while taking precautions such as wearing masks and maintaining physical distance.”
GET LOCAL
Modi also focussed on the importance of local manufacturing, local markets and local supply chains, saying the coronavirus crisis had taught India the importance of these key elements. “All our demands during the crisis were met locally. Now, it is time to be ‘vocal about local’ products and help them become global,” he said.
He said the definition of self-reliance had undergone a change in the globalised world and stressed that it’s not the same as being self-centred.
“India’s culture considers the world as one family, and progress in India is part of, and also contributes to, progress in the whole world,” he said. “The world trusts that India has a lot to contribute towards the development of entire humanity.”
‘QUANTUM JUMP’
He also elaborated on the five pillars of self-reliance.
As far as the economy is concerned, the government was looking for a “quantum jump” and not “incremental change”, he said. Infrastructure “should become the identity of India”. The system should be based on 21st century technology-driven arrangements. A vibrant demography is the source of energy for a self-reliant India. The supply chain should be utilised to full capacity to meet strong demand. “We need to strengthen all stakeholders in the supply chain to increase, as well as fulfil, the demand,” he said.
Every crisis is an opportunity, Modi said, pointing to the example of personal protective equipment (PPE). Before the Covid-19 pandemic struck, India didn’t make PPE or N95 masks. Now the country makes 200,000 PPE kits and 200,000 N95 masks every day, he said.
Major takeaways of Prime Minister's Address :
economictimes.indiatimes.com
By Surabhi Agarwal, Megha Mandavia, Priyanka Sangani
ET Bureau|Last Updated: May 13, 2020, 03.26 PM IST
The package is for our labourers, farmers, honest tax payers, MSMEs and cottage industry, Narendra Modi said.
India fights Covid-19: PM Modi announces Rs 20 Lakh Cr Atmanirbhar Bharat Abhiyan package
PM Narendra Modi announced a Rs 20-lakh-crore stimulus package, equivalent to about 10% of India’s GDP, aimed at making the country self-reliant and reviving the stalled economy. Details of the plan, dubbed the Atmanirbhar Bharat Abhiyaan, will be unveiled by finance minister Nirmala Sitharaman starting Wednesday, the Prime Minister said in his address to the nation on Tuesday evening.
The programme encompasses earlier packages announced by the government and the Reserve Bank of India, Modi said, adding that bold reforms are needed to make the country self-reliant so that crises such as the Covid-19 pandemic can be overcome in future.
“These reforms include supply chain reforms for agriculture, rational tax system, simple and clear laws, capable human resources and a strong financial system,” he said. “These reforms will promote business, attract investments, and further strengthen ‘Make in India’.”
The package will focus on land, labour, liquidity and laws, and will cater to various sectors including the cottage industries, micro, small & medium enterprises (MSMEs), the working class, middle class and industry, among others. He said the package will also focus on empowering the poor, labourers and migrant workers, both in the organised and unorganised sectors. It will seek to increase efficiency and ensure quality.
The government had announced a Rs 1.7 lakh crore stimulus plan on March 26. The Reserve Bank of India has also launched various programmes to help borrowers and boost liquidity, besides cutting interest rates to a record low.
Five Pillars for Self-Reliance
Last week, the government raised its gross market borrowing target for the current financial year to Rs 12 lakh crore from Rs 7.8 lakh crore estimated in the budget.
Self-reliance will prepare India for tough competition in the global supply chain, and it is important that the country should emerge victorious, he said. He said a selfreliant India will stand on five pillars — the economy, infrastructure, system, demography and demand.
India’s nationwide lockdown began on March 25 and is scheduled to stay in place until May 17, although there have been some relaxations since May 4. Modi said the government will provide details about the next phase, or Lockdown 4.0, before May 18. The contours of this will be different from those seen so far and new rules will be framed on the basis of recommendations by the states. Modi had held a video-conference with chief ministers on Monday.
“Several experts and scientists have said that the virus is going to be a part of our lives for a long time,” he said. “But it is also important to ensure that our life does not revolve only around it. People should work toward their targets while taking precautions such as wearing masks and maintaining physical distance.”
GET LOCAL
Modi also focussed on the importance of local manufacturing, local markets and local supply chains, saying the coronavirus crisis had taught India the importance of these key elements. “All our demands during the crisis were met locally. Now, it is time to be ‘vocal about local’ products and help them become global,” he said.
He said the definition of self-reliance had undergone a change in the globalised world and stressed that it’s not the same as being self-centred.
“India’s culture considers the world as one family, and progress in India is part of, and also contributes to, progress in the whole world,” he said. “The world trusts that India has a lot to contribute towards the development of entire humanity.”
‘QUANTUM JUMP’
He also elaborated on the five pillars of self-reliance.
As far as the economy is concerned, the government was looking for a “quantum jump” and not “incremental change”, he said. Infrastructure “should become the identity of India”. The system should be based on 21st century technology-driven arrangements. A vibrant demography is the source of energy for a self-reliant India. The supply chain should be utilised to full capacity to meet strong demand. “We need to strengthen all stakeholders in the supply chain to increase, as well as fulfil, the demand,” he said.
Every crisis is an opportunity, Modi said, pointing to the example of personal protective equipment (PPE). Before the Covid-19 pandemic struck, India didn’t make PPE or N95 masks. Now the country makes 200,000 PPE kits and 200,000 N95 masks every day, he said.
Major takeaways of Prime Minister's Address :
- Lockdown 4 will be announced before May 18 and will have new rules.
- This package focuses on land, labour, liquidity and law. It will help small industries and MSMEs.
- PM delved on the amount of loss caused by the 120 nm novel coronavirus
- The irreparable loss which occurred due to the pandemic is beyond any explanation
- India has converted the challenge of coronavirus into an opportunity
- India needs to fulfil its role as one of the leaders in the 21st century
- The Pandemic has taught us the true value of self-reliance
- India has always been a leader and our efforts at International forums are a testimony.
- 5 pillars of India's self-reliance- Economy ,Infrastructure, System, Demography, Demand.
PM Modi speech highlights: PM Modi announcements, key highlights
The package is for our labourers, farmers, honest tax payers, MSMEs and cottage industry, Narendra Modi said.
To those who forgot. Comrades Pinarayyi & Thomakuttan came out with this. Since then there's been a deafening silence . Perhaps ppl from Kerala can comment better.
Centre is guaranteeing it. Meaning it's the government's responsibility. A hark back to the loan melas during IG's times except we don't have a choice today.
Truck full of them.
Loan is borrowing from future income to use today, but in present situation if we don't act today there won't be any future income so long term pain.
We won't be in so much trouble if genuine businesses fail and create NPA, it's abuse of this system to make money that destroys credibility and system. This is happening from decades now, Corona or not.
Yes, it will. But giving loans to MSMEs are less risky compared to corporates. They are less likely to become wilful defaulters.
NPAs will always be there. Businesses fail, its natural. That risk is inbuilt in financial institutions business model. It goes wrong when PSBs lend outside of their risk factors because these big companies has 'influence'. (During UPA time, it was called phone banking because someone from MoF will call these bank chairman to give huge loans). Those corporate took the money because there was no correction mechanism (AKA bankruptcy code). They knew they could drag the PSBs for years are years in court.
Times have changed, incentive are different now. Some big names have taken hit. Problem now is that even with enough liquidity PSBs are afraid of lending in normal risk factors. Because of the horrors of last 10 years. At the same time businesses are also not inclined to take huge loans because of general uncertainty, market sentiment, government not delivering on promises of reforms etc.
So, now this step would somewhat fix many things for the MSMEs. Atleast it will give a second chance to many. For government this is a risk they have to take to limit huge fallout of this situation.
Full picture is yet to come out. Its only first batch of announcement apparently. Hope they mix some concrete reforms with this.
IMO Its in a way an alternative to what is called “Helicopter Money” . So you can guess yourself.
The Strategic Implications of Indian Corruption
The massive network of corruption now being unraveled has major geopolitical and security implications that reach far beyond India.
thediplomat.com
Trump to tax companies manufacturing outside US; Apple's India plan may be hit
May 15, 2020, 3:14 pm IST
PTI
Business, Companies
Trump said that taxation was an incentive for the companies to return manufacturing bases to the US
Trump has threatened to slap new taxes on American companies like Apple to dissuade them from moving their manufacturing bases from China to countries like India. (AFP Photo)
Washington: President Donald Trump has threatened to slap new taxes on American companies like Apple to dissuade them from moving their manufacturing bases from China to countries like India and Ireland instead of the US amidst the COVID-19 pandemic.
In an interview, Trump said that taxation was an incentive for the companies to return manufacturing bases to the US.
“Apple said now they're going to go to India. They're going to do some production in India away from China,” he was asked.
"If they do, you know, we gave Apple a little bit of a break because they're competing with a company that was a part of a trade deal that we made. So it was a little bit unfair to Apple, but we're not allowing this anymore. You know if we wanted to put up our own border like other countries do to us, Apple would build 100 percent of their product in the United States. That's the way it would work,” he said.
According to the New York Post, Apple is looking to shift a significant portion of its production to India from China.
Free Games on Deccan Chronicle. No Installing, No Charges. Stay Home Stay Safe. Click the Banner to play Now.
Supply lines of many tech companies manufacturing in China were disrupted after the deadly coronavirus outbreak in the Chinese city of Wuhan.
“These companies have to get on the ball because they're going not only to China. You look at where they're going. They're going to India and they're going to Ireland and they're going all over the place, they make them," Trump said in the interview.
"So, you don't think you need to do anything in terms of incentives," he was asked.
“I have to do it,” Trump said.
“One incentive, frankly, is to charge tax for them when they make products outside. We don't have to do much for them. They have to do it for us,” Trump said. Trump said that he wants to bring manufacturing back to the US.
“And now they're not fighting. These stupid supply chain that are all over the world, we have a supply chain where they're made in all different parts of the world and one little piece of the world goes bad and the whole thing is messed up. I said we shouldn't have supply chains. We should have them all in the United States. We have the companies to do it. And if we don't, we can do Apple, China, Coronavirus, Coronavirus Outbreak, Coronavirus Pandemic, COVID-19, India, Manufacturing, NewsTracker, Tax, US that," he added.
Trump has routinely threatened to raise tariffs on consumer electronics during his ongoing trade war with China
May 15, 2020, 3:14 pm IST
PTI
Business, Companies
Trump said that taxation was an incentive for the companies to return manufacturing bases to the US
Trump has threatened to slap new taxes on American companies like Apple to dissuade them from moving their manufacturing bases from China to countries like India. (AFP Photo)
Washington: President Donald Trump has threatened to slap new taxes on American companies like Apple to dissuade them from moving their manufacturing bases from China to countries like India and Ireland instead of the US amidst the COVID-19 pandemic.
In an interview, Trump said that taxation was an incentive for the companies to return manufacturing bases to the US.
“Apple said now they're going to go to India. They're going to do some production in India away from China,” he was asked.
"If they do, you know, we gave Apple a little bit of a break because they're competing with a company that was a part of a trade deal that we made. So it was a little bit unfair to Apple, but we're not allowing this anymore. You know if we wanted to put up our own border like other countries do to us, Apple would build 100 percent of their product in the United States. That's the way it would work,” he said.
According to the New York Post, Apple is looking to shift a significant portion of its production to India from China.
Free Games on Deccan Chronicle. No Installing, No Charges. Stay Home Stay Safe. Click the Banner to play Now.Supply lines of many tech companies manufacturing in China were disrupted after the deadly coronavirus outbreak in the Chinese city of Wuhan.
“These companies have to get on the ball because they're going not only to China. You look at where they're going. They're going to India and they're going to Ireland and they're going all over the place, they make them," Trump said in the interview.
"So, you don't think you need to do anything in terms of incentives," he was asked.
“I have to do it,” Trump said.
“One incentive, frankly, is to charge tax for them when they make products outside. We don't have to do much for them. They have to do it for us,” Trump said. Trump said that he wants to bring manufacturing back to the US.
“And now they're not fighting. These stupid supply chain that are all over the world, we have a supply chain where they're made in all different parts of the world and one little piece of the world goes bad and the whole thing is messed up. I said we shouldn't have supply chains. We should have them all in the United States. We have the companies to do it. And if we don't, we can do Apple, China, Coronavirus, Coronavirus Outbreak, Coronavirus Pandemic, COVID-19, India, Manufacturing, NewsTracker, Tax, US that," he added.
Trump has routinely threatened to raise tariffs on consumer electronics during his ongoing trade war with China