COVID Special Pack contains 6 MSME fixes for running certified PM Modi logo in India
Finance Minister Nirmala Seetharaman announced about 15 measures on Wednesday, including six for SMEs, to revive the affected economy of COVID 19.
On Wednesday, the central government announced six reforms to support small and medium-sized businesses – the backbone of the Indian economy – affected by the economic recession caused by the outbreak of the coronavirus. In announcing the reforms, the Finance Minister claimed that the changes are aimed at making the Indian economy dependent on itself. The following are the six reforms or measures announced by the Minister of Finance.
1. An automatic loan without guarantees for SMEs of up to Rs 3 crore, which means that one unit of MSME does not need to pay any guarantees or guarantees for loans provided under this scheme. Nor will they be required to pay any major component of the loan for the first year. The loan term is 4 years. This will benefit from 45 Lakh units, which will resume their commercial activities and protect jobs, he said.
2. Secondary debts of Rs. 20,000 crores for stressful MSMEs facing a property rights problem. It will assist in operating MSMEs that are either NPA (non-performing assets) or economically stressful. Rs. 2 qualifies for the number of MSMEs in this category. The government will provide a partial credit guarantee support of Rs. 4000 crores to banks and the promoters of MSMEs will be given debt by the banks in the form of stock injections.
3. A financing fund to finance Rs 50,000 crore as capital for SMEs. This will benefit potential and potential MSMEs by providing them with greater support in capacity expansion and for market inclusion. This will cover MSMEs that are performing well and can take advantage of the opportunity to expand.
4. The definition of MSMEs is changed to encourage MSMEs to grow further without losing the benefits provided by MSMEs. The investment limit setting MSMEs is adjusted upwards with a turnover rate added as criteria for the classification of MSMEs. Also, the distinction is made between manufacturing and servicing MSMEs.
For small projects in both the manufacturing and services sectors, the investment limit is raised from Rs 25 and 10 rupees respectively to Rs 1 crore with a maximum turnover of Rs. 5 crores. Likewise, for small enterprises in both sectors, the investment limit is raised from Rs. 5 crore and Rs. 2 crores, respectively, to Rs. 10 crores with a maximum turnover of Rs. 50 crore and finally to medium enterprises in the manufacturing and services sector, the investment has been raised the maximum of 10 base rupees and Rs 5 crore respectively to Rs 20 crore with a maximum turnover of Rs 100 crore.
5. Government tenders for purchases of up to Rs. 200 crores will not be open to international tenders/players, allowing small and medium-sized companies the opportunity to compete. The government has said it will make the necessary adjustments to the public finance rules to enable this provision. Sitharaman said this was a major step towards creating a self-reliant India.
6. Post-credit trade prices will be difficult, so the e-connectivity market is provided for MSMEs. Also, the government promised to liquidate all dues due to MSMEs in the next 45 days.