India takes measures to support MSMEs

The Aatmanirbhar India campaign started by Prime Minister Narendra Modi during the announcement of Lockdown 4.0 came along with the announcement of a package of Rs 20,000 lakh crore, nearly 10% of India’s annual GDP. The current COVID-19 pandemic has hit every industry hard, especially medium and small enterprises and startups. After assessing the situation, the government has come up with some measures to support MSMEs in coming out of this struggle and these were announced during the different tranches of the economic package by the Finance Minister Nirmala Sitharaman.

Here are some of the measures to support MSMEs:

• Rs 3 lakh crore Emergency Working Capital Facility for Businesses including MSMEs
• Rs 20,000 crore Subordinate Debt for Stressed MSMEs
• Rs 50,000 crore equity infusion through MSME Fund of Funds
• New Definition of MSME and other Measures for MSME
• No Global tenders for Government tenders of up to Rs 200 crore
• Extending the Employees Provident Fund Support for business and organised workers for another 3 months for salary months of June, July and August 2020
• EPF Contribution to be reduced for Employers and Employees for 3 months to 10% from 12% for all establishments covered by EPFO for the next 3 months
• Rs. 30,000 crore Special Liquidity Scheme for NBFC/HFC/MFIs
• Rs. 45,000 crore Partial credit guarantee Scheme 2.0 for Liabilities of NBFCs/MFIs
• Rs 90,000 crore Liquidity Injection for DISCOMs
• Relief to Contractors given by extension of up to six months for completion of contractual obligations, including in respect of EPC and concession agreements
• Relief to Real Estate Projects the registration and completion date for all registered projects will be extended up to six months.
• Tax relief to business as pending income tax refunds to charitable trusts and non-corporate businesses and professions to be issued immediately
• Reduction in Rates of ‘Tax Deduction at Source’ and ‘Tax Collected at Source” by 25% for the remaining period of FY 20-21
• Due Dates for various tax-related compliances extended