Atmanirbhar Bharat 3.0: A close look at the new schemes announced by FM Sitharaman on November 11

Finance Minister Nirmala Sitharaman on November 12 announced 12 schemes worth Rs 2.65 lakh crore as part of the Atmanirbhar Bharat 3.0 package.

She further said that the Centre and the Reserve Bank of India (RBI) have together provided total fiscal stimulus of Rs 29.87 lakh crore since the COVID-19 pandemic began. This amount is 15 percent of India’s gross domestic product (GDP), according to FM Sitharaman.

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Here’s a look at all schemes announced today

>> Atmanirbhar Bharat Rozgar Yojana.

The Atmanirbhar Bharat Rozgar Yojana is being launched to incentivise the creation of new employment opportunities. EPFO registered organisations that employ new employees with no previous EPFO account or if they re-employ those who lost their jobs between March 1 and September 30, 2020, will be benefitted. The salary of the newly employed or re-employed should not exceed Rs 15,000/month.

The scheme will be effective from October 1, 2020, to be operational till June 30, 2021.

>> Emergency Credit Line Guarantee Scheme (ECLGS) extended and 2.0 launched

The ECLGS has been extended till March 31, 2021, with no changes to the original scheme.

>> ECLGS 2.0 launched for 26 stressed sectors and healthcare

Further, the Centre is launching credit guarantee support for 26 stressed sectors as per the Kamath panel report, plus healthcare sector, with credit outstanding of Rs 50 crore to Rs 500 crore.

Original ECLGS had one year of moratorium and four-year repayment. Under the new scheme, entities will get additional credit up to 20 percent of outstanding credit, with one-year moratorium and 5-year repayment period. There will be no upper ceiling on annual turnover. The new scheme will be dovetailed with the current ECLGS extension up to March 31, 2021.

>> Boost for Atmanirbhar Bharat production linked incentives (PLI) scheme for 10 “champion sectors”

Ten additional “champion sectors will be covered under the PLI scheme to boost competitiveness of domestic manufacturing. This is expected to give a significant boost to economic growth and domestic employment.

Here, a total amount of nearly 1.5 lakh crore has been earmarked across sectors, for the next five years. The sectors are: advance cell chemistry battery (Rs 18,100 crore), electronic/technology products (Rs 5,000 crore), automobiles and auto components (Rs 57,042 crore), pharmaceutical drugs (Rs 15,000 crore), telecom and networking products (Rs 12,195 crore), textile products (Rs 10,683 crore), food products (Rs 10,900 crore), high efficiency solar PV modules (Rs 4,500 crore), white goods (ACs and LED) (Rs 6,238 crore), and specialty steel (Rs 6,322 crore)

>> Rs 18,000 crore additional outlay to PMAY - Urban

The finance minister announces additional outlay of Rs 18,000 crore for PM Awaas Yojana - Urban through additional allocation and Extra Budgetary Resources (EBR). This is over and above the Rs 8,000 crore already given this year. It will help ground 12 lakh houses and complete 18 lakh houses, will create additional 78 lakh jobs, and improve production and sale of steel and cement, resulting in multiplier effect on the economy.

>> Support for construction and infrastructure sector

Performance security now reduced to 3 percent from the previous 5-10 percent and will be available for all dispute-free projects and public sector projects. States will be encouraged to adopt this. Also providing relaxation of Earnest Money Deposit (EMD) and Performance Security on government tenders, which will be replaced by bid security self-declaration.

Relaxations have been given till December 31, 2021, under general financial rules. This will provide ease of doing business and relief to contractors whose money otherwise remains locked up.

>> Residential Real Estate I-T relief for developers and homebuyers

The Centre has decided to increase the differential from 10 percent to 20 percent (under section 43CA) for the period from the date of the announcement to June 30, 2021, for only primary sale of residential units of value up to Rs 2 crore. Consequential Relief up to 20 percent shall also be allowed to buyers of these units under section 56(2)(x) of IT Act for the said period.

The necessary amendment to the IT Act would be proposed in due course.

This measure will reduce hardships faced by both home-buyers and developers and help in clearing the unsold inventory.

>> Rs 6,000 crore equity infusion in NIIF Debt Platform

The government will invest Rs 6,000 crore as equity while rest will be raised from private investors. The aim is to provide Rs 110,000 crore infra project financing by 2025. To this end, the NIIF has already invested Rs 2,000 crore in equity of the platform, Sitharaman said.

>> Support for Agriculture Rs 65,000 crore for subsidised fertilisers

Up to Rs 65,000 crore is provided to ensure adequate availability of fertilisers to farmers to enable timely availability in the upcoming crop season. Increased supply of fertilisers at subsidised rates will help 140 million farmers.

There is an estimated increase in fertiliser usage of 17.8 percent over the actual usage in 2019-20 of 571 lakh metric tonnes. The increase is on account of favourable monsoons and the resultant increase in sown area. Fertiliser consumption which was 499 lakh MT in 2016-17 is expected to increase to 673 lakh MT in 2020-21.

>> Rural Employment – Enhanced outlays under PM Garib Kalyan Rozgar Yojana

Additional outlay of Rs 10,000 crore will be provided for PM Garib Kalyan Rozgar Yojana in the current financial year to accelerate growth of the rural economy.

PMGKRY is in progress in 116 districts and Rs 37,543 crore is spent till date. It effectively dovetails various schemes including MGNREGA, PMGSY, etc.

>> Boost for Project Exports – Rs 3000 crore to EXIM bank for Lines of Credit

Up to Rs 3,000 crore will be released to EXIM Bank for the promotion of project exports through Lines of Credit (LOC) under IDEAS scheme. This promotes Indian export by mandating recipient countries to import 75 percent value of the LOC. Supported projects cover Railways, power, transmission, road and transport, auto and auto components, sugar projects, etc.

>> Capital and Industrial Stimulus

Up to Rs 10,200 crore additional budget outlay will be provided towards capital and industrial expenditure and domestic defence equipment. This will cover industrial incentives, industrial infrastructure and green energy.

>> R&D grant for COVID Vaccine Development