Banks will offer collateral-free loans amounting to Rs 3 lakh crore rupees to small and medium businesses as part of the first round of the relief package announced by Finance Minister Nirmala Sitharaman on Wednesday.
Banks will offer collateral-free loans amounting to Rs 3 lakh crore rupees to small and medium businesses as part of the first round of the relief package announced by Finance Minister Nirmala Sitharaman on Wednesday. PM Modi, who had promised a Rs 20 lakh crore (Rs 20 trillion) in his televised address to the nation a day earlier, said the announcements made will go a long way in addressing issues faced by businesses, particularly medium and small enterprises that have been considered the bedrock of the Indian economy.
“The steps announced will boost liquidity, empower the entrepreneurs and strengthen their competitive spirit,” PM Modi said
A big part of Wednesday’s announcement focused on small and medium enterprises that will be entitled to get unsecured loans till October 31. This will be available to units with upto Rs 25 crore outstanding and turnover of up to Rs 100 crore.
She told reporters the government aims to help 4.5 million businesses by October.
Sitharaman will be back tomorrow with more announcements for other sectors.
“We have a responsibility toward the poor, the needy, the migrants and the disabled,” Sitharaman said, in the first of several daily press conferences on the 15-point package.
“Essentially this is to spur growth and to build a very self-reliant India,” she said. “It addresses ease of doing business, compliance and due diligence and the intention is also to build local brands.”
That was the recurring theme in PM Modi’s televised address, his fourth after the coronavirus outbreak in the country. The last three had focused on the 50-day lockdown and the disease.
Yesterday, PM Modi appeared to be trying to prepare the country to take precautions, but move on. He told people not to let our lives revolve around the disease but turn the crisis into an opportunity.
The three leading industry bodies, CII, Ficci and Assocham, welcomed the announcements.
CII director general Chandrajit Banerjee described the first tranche of the package called Atma Nirbhar Bharat Abhiyan “impactful”.
“The first phase targets the key sectors of MSME, employee provident fund, Discoms, and taxation among other major areas that are the most impacted,” Banerjee said.
Sangita Reddy, president, FICCI, said round one of the package signalled that the government was ready and would lead from the front.
Assocham secretary general Deepak Sood said the upward revision of investment limit in the definition of small enterprises is an example of the government responding well to the emergent situation.
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