Stimulus 3.0: Centre pushes jobs and infra, expands support to rural sector

New Delhi, Nov. 12 (IANS): Announcing a fresh round of stimulus package and terming it as ‘Atmanirbhar Bharat 3.0’, Finance Minister Nirmala Sitharaman laid down a total of 12 new measures to support the economy and industry, ranging from employment generation, collateral-free credit for stressed sectors to subsidised fertiliser for farmers.

Sitharaman announced the ‘Atmanirbhar Bharat Rozgar Yojana’ to incentivise creation of new employment opportunities during the Covid-recovery phase.

The employment scheme effective from October 1 will be applicable to eligible new employees joining the EPFO-registered establishments and for those who exited these concerns during the Covid pandemic (March 1-September 30, 2020) and drawing monthly wages of less than INR 15,000.

Under the scheme, the central government will subsidise the Employees’ Provident Fund (EPF) contributions for two years.

The Centre will provide 12 per cent of the contributions of both employers and the employee for establishments with up to 1,000 employees. In the case of establishments with over 1,000 employees, the Centre will only subsidise 12 per cent of the employees’ EPF contributions.

Also, in order to provide a further boost to rural employment, the government will provide an additional outlay of INR 10,000 crore for the Pradhan Mantri Garib Kalyan Rozgar Yojana.

The government will provide INR 65,000 crore to farmers to ensure adequate supply of fertilisers in the upcoming crop season.

In a major decision to support the pandemic-hit industry, the government has also announced an Emergency Credit Line Guarantee Scheme (ECLGS 2.0) for providing much needed relief to stressed sectors by helping entities sustain employment and meet liabilities.

The ECLGS scheme for MSMEs, MUDRA loan borrowers and individuals has been extended till March next year.

In a bid to boost housing sales, Sitharaman announced an increase in the permitted differential between the circle rate and agreement value of housing units to 20 per cent from the current mandated limit of 10 per cent till June 30.

The increase in differential will be applicable in residential units of value up to INR 2 crore.

Section 43CA of IT Act restricts differential between circle rate and agreement value at 10 per cent. However, prices may actually be lower than that, and the restrictions curbs sale of housing units.

To provide ease of doing business and relief to contractors whose money otherwise remains locked up, performance security on contracts will be reduced to 3 per cent earnest money deposit (EMD) for tenders will be replaced by bid security self-declaration. The relaxation will be available till December 31, 2021.

INR 18K cr outlay for PMAY-Urban

The Centre will allocate INR 18,000 crore more to the Pradhan Mantri Awas Yojana (PMAY) – Urban for building houses for middle income and economically weaker sections of the country.

The amount of INR 18,000 crore will be provided over the Budget Estimates for 2020-21 through additional allocation and extra budgetary resources.

The allocation is over and above INR8,000 crore already this year.

As per the government, the decision will help 12 lakh houses to be launched and 18 lakh houses to be completed and create 78 lakh additional jobs.

In another major to boost the real estate sector, Finance Minister Nirmala Sitharaman announced an increase in the permitted differential between the circle rate and the agreement value of housing units to 20 per cent from the current mandated limit of 10 per cent till June 30.

The increase in differential will be applicable in residential units of value up to INR 2 crore. It will help in reducing the tax liability as the tax will be applicable on lower value of residential units.

Section 43CA of the IT Act restricts differential between circle rate and the agreement value at 10 per cent. However, prices may actually be lower than that, and the restriction curbs sale of housing units.

Sitharaman said that the decision has been taken to boost sales at a time when demand is low and inventories have piled up.

INR 10K cr. more for PMGKRY

The Centre will allocate an additional amount of INR 10,000 crore for the Prime Minister Garib Kalyan Rozgar Yojana in a bid to boost rural employment amid the pandemic, Finance Minister Nirmala Sitharaman said on Thursday.

The scheme, which includes various employment generating schemes including the MGNREGs, PMGSY among others, is in progress in 116 districts and INR 37,543 crore has been spent till date as per government data.

The Centre had provided INR 61,500 crore for MGNREGS in the budget for 2020-21. An amount of INR 40,000 crore was additionally provided in ‘Atmanirbhar Bharat 1.0’.

As on date, INR 73,504 crore has been released under the MGNREGS and 251 crore person-days of employment have been generated as per the Finance Ministry.