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'Big boost for MSMEs': How India Inc. reacted to coronavirus relief package, economic stimulus

Gautam Adani said that that the stimulus package could be a growth plank to push Make In India vision. Kunal Bahl said that MSMEs were India's backbone and government's announcement would help them to get back on their feet

twitter-logoBusinessToday.In | May 14, 2020 | Updated 10:27 IST
'Big boost for MSMEs': How India Inc. reacted to coronavirus relief package, economic stimulus
Union Finance Minister Nirmala Sitharaman wearing a face mask gestures as she announces the governments economic package to fight the coronavirus pandemic

The industry bodies and leading businessmen have lauded the financial package and policy interventions announced by Finance Minister Nirmala Sitharaman on Wednesday. The Indian Chamber of Commerce stated that the turnover-based definition of MSMEs has addressed a long pending demand and extended the benefits to a large number of companies.

Sitharaman also announced Rs 3 lakh crore of collateral-free loans for small businesses. On which, the industry body said, "The Rs 3 lakh crore government-guaranteed loans to the liquidity-starved MSMEs would go a long way in stabilising and strengthening the sector".

Also read: FM's measures to bring liquidity, long term benefits to MSMEs, say experts

Gautam Adani, Adani Group chairman said that that the stimulus package could be a growth plank to push Make In India vision. Adani on Twitter wrote, "I truly believe that India's economic resilience thrives upon the tenacity of our smaller traders. FM Nirmala Sitharaman's stimulus for MSMEs can be a growth plank pushing the Make in India vision, creating jobs, and shaping a self-reliant India".

Pawan Goenka, managing director of Mahindra and Mahindra Ltd wrote on Twitter, "Certainly a big boost for MSMEs. Should go a long way in strengthening MSMEs beyond COVID19. Public procurement, receivable clearance are big steps".

Snapdeal CEO Kunal Bahl said that MSMEs were India's backbone and government's announcement would help them to get back on their feet. Bhal also said that "Additional collateral and guarantee free loans, equity funding options, better access to govt procurement, e-market linkage and higher thresholds are strong enablers".

Bahl also added that liquidity and credit guarantees for banks and NBFCs would remove hesitation in lending. "Friction-free implementation of these measures can slowly convert adversity to advantage".

Sajjan Jindal, Chairman and MD of JSW Group stated that "Sitharaman gave a strong thrust to MSMEs who are the backbone of our economy, through a combination of automatic collateral-free loans to the MSMEs as well as credit enhancements to banks and NBFCs who are key lenders to this sector".

Jindal also added that the onus lied on banks and NBFCs to ensure that credit flows to the sector.

The Finance Minister also announced the rates of Tax Deduction at Source (TDS) and Tax Collection at Source (TCS) have been cut by 25 per cent of the existing rates for the remaining part of the 2020-21 fiscal. The measure will release the liquidity of Rs 50,000, she added.

On which Goenka said that "TDS deferment is a big deal. Will put extra money in the hand of the consumers for the next 11 months. Should help to boost demand. A very smart move".

In a big relief to the domestic power sector, Sitharaman also announced liquidity injection of Rs 90,000 crore for the debt-ridden power distribution companies. The FM also ordered state governments and Union Territories to extend the timelines of RERA projects by six months.

Also read: Stimulus package 2.0: Power discoms get Rs 90,000 crore liquidity jumpstart

RPG Enterprises Chairman Harsh Goenka said that the FM has injected vaccines with unprecedented stimulus measures replacing corona with "Karo na".

Also read: First tranche of Stimulus 2.0 worth Rs 5.94 lakh crore; govt's burden only Rs 56,500 crore

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