New Delhi: The Central government will "upfront" infuse Rs 70,000 crore into public sector banks for extending additional lending.
At present, the economy has been impacted by a consumption slowdown which is a culmination of several factors such as high GST rates, farm distress, stagnant wages and liquidity constraints.
Besides, the stress in the NBFCs has led to a liquidity squeeze in the automobile and other type of capital goods purchases.
Finance Minister Nirmala Sitharaman said that the budgeted Rs 70,000 crore re-capitalisation of PSBs will be infused upfront so as to enable additional funding. This step is expected to allow PSBs to extend additional funding of Rs 5 lakh crore.
She further announced that PSBs have decided to launch repo-rate linked products.
PSBs have been mandated to return loan documents to customers within 15 days of their loan closure.
Following are the measures announced by Finance Minister Nirmala Sitharaman on Friday to boost economic growth and address distress in various sectors:
* Drops super-rich surcharge on FPIs, domestic investors on gains from stock market
* Upfront release of Rs 70,000 cr to PSBs; enhances lending capacity by Rs 5 lakh cr
* Banks to pass on rate cuts; to benefit all borrowers
* Reduction on EMIs for housing loans, vehicle and other retail loans
* To provide protection to honest decision-making by bankers for boosting lending
* Additional liquidity support to HFCs raised to Rs 30,000 cr
* Pending GST refunds to MSMEs to be paid within 30 days
* Amendment to MSME Act to move towards single definition to be considered
* Issue of IT orders, notices, etc through a centralised system to cut harassment
* Startups registered with DPIIT exempt from Income Tax, subject to certain conditions
* To set up a dedicated cell under CBDT for addressing the problems of startups
* BS-IV vehicles purchased till March 31, 2020 to be operational for registration period
* Allows additional 15 pc depreciation on all vehicles till March 31, 2020
* Delayed payments from Govt/CPSEs to be monitored by Expenditure Dept
* CSR violation not to be treated as criminal offence
* To set up an entity for credit enhancement for infrastructure, housing projects
* Task force to be set up to finalise the pipeline of infrastructure projects
* Further action on development of Credit Default Swap markets soon
* Simplification of KYC procedure to improve market access for foreign investors
* To announce more measures in the coming weeks for other sectors
* Announcement with regard to real estate sector to be made next week.