Nirmala Sitharaman, the Finance Minister of India, on the 16th of May, announced the 4th break down of the Rs. 20 lakh crores stimulus package to fight Novel Coronavirus.
In today’s announcement, Ms. Sitharaman focussed on 8 sectors, coal, minerals, defence production, airspace management, airports, MRO, power distribution companies in UTs, space and atomic energy.
Under the Atma Nirbhar Abhiyan (Self Reliant Mission) to boost Indian economy, Ms. Siharaman said, “The structural reforms being announced today will impact those sectors which are new horizons of growth, unleashing new investment, boosting production and creating jobs,”
Ms. Sitharaman said the Government monopoly in the coal sector would be removed so it would attract commercial mining in India.
The Foreign Direct Investment (FDI) limit in defence manufacturing would be raised from 49 % to 74 % under the automatic route, allowing private space sectors to work with the Indian Space Research Organisation (ISRO) facilities for India.
Announcement benefiting Atomic Energy Sector:
- Government would establish a research reactor in Personal Protection Equipment (PPE) basis for production of medical isotopes promoting welfare of humanity with affordable treatment for cancer and other diseases.
- The Government would also establish facilities to use irradiation technology for food preservation, again in PPE mode. This technology will compliment agricultural reforms and assist farmers.
- The Government would lastly link India’s robust startup ecosystem to the nuclear sector to foster a synergy between research facilities and tech entrepreneurs.
Announcement to boost private sector investments in social infrastructure projects:
In projects like hospitals and social infrastructures, the private sector would be allowed to invest by revamping the Viability Gap Funding Scheme. The total outlay for this has been pegged at Rs. 8,100 crore.
The Government would also enhance the quantum of viability gap funding up to 30 % for each of such social infrastructure projects.
Only hospital structure would have VGP support from the Central Government of 30 %, but other infrastructure would get a VGP existing support of 20% each from the Government.
Projects to be proposed by Central Ministries/State governments and statutory entities
The government will release a tariff policy with reforms, including consumer rights, promotion of industry and sustainability of the sector
Policy reforms to fast-track investment under ‘Atma Nirbhar Bharat’
- Fast track investment clearance through Empowered Group of Secretaries (EGoS)
- Project Development Cell in each Ministry to prepare investable projects, coordinate with investors and Central/State Governments
- Ranking of States on Investment Attractiveness to compete for new investments
- Incentive schemes for Promotion of New Champion Sectors will be launched in sectors such as Solar PV manufacturing; advanced cell battery storage; etc
Ms. Sitharaman announced policy and structural reforms in all the 8 sectors, improving the chances of enhancing economic condition.
The Finance Ministry also announced six more airports for auction under a PPE model. Annual revenue from this in the first round could come up to Rs 1,000 crore/year with an additional down payment of Rs. 2,300 crores for the Airports Authority of India. Additional investment by private players in 12 airports in the first and second rounds are expected to bring in around 13,000 crore. Another six airports will be put out for the third round of bidding.
Meanwhile, India reported a total of 85,950 cases of the Novel Coronavirus till the 16th of May.