Covid care: Sitaraman lists measures to boost rural jobs, healthcare, e-learning and business
17 May 2020
Finance minister Nirmala Sitaraman today announced a number of measures aimed at boosting employment, healthcare, education, especially technology-driven education, and the ease of doing business, as the last tranche of the Rs20 lakh crore economic relief package announced by Prime Minister Narendra Modi.
The finance minister also announced an increase in the borrowing limit for states from 3 per cent to 5 per cent of state gross domestic product (SGDP) to handhold states in difficult financial conditions.
To provide employment to the most affected sections of the population, Sitaraman said the government will now allocate an additional Rs40,000 crore under Mahatma Gandhi National Rural Employment Generation Scheme (MGNREGS). It will help generate nearly 3 billion mandays of employment while also addressing the need for more work, including returning migrant workers in monsoon season as well. This will also result in creation of larger number of durable and livelihood assets, including water conservation assets, and also boost the rural economy through higher production.
She said the basic aim of all these measures, beginning with Prime Minister Narendra Modi’s announcement of the Rs1.70 lakh crore Garib Kalyan Package (PMGKP), which included distribution of free food grains, cash payment to women and poor senior citizens and farmers etc, is to sustain health and productivity of the people.
“The swift implementation of the package is being continuously monitored. Around 410 million poor people received financial assistance of a total Rs52,608 crore under the PMGKP,” the finance minister said, adding, that the PMGKP also used technology for Direct Benefit Transfer (DBT) to people. “We could do what we did because of the initiatives taken during the last few years,” she further pointed out.
In addition, states have lifted 84 lakh metric tonnes of food grains from Food Corporation of India (FCI) godowns. States have also been provided with more than 3.5 lakh metric tonnes of pulses. And for this, Sitharaman appreciated the concerted efforts of FCI, NAFED and states, despite logistical challenges.
Announcing the 5th and last Tranche of measures towards government reforms and enablers, Sitharaman detailed seven measures for providing employment, support to businesses by improving the ease of doing business, enabling technology-driven education, expanding healthcare facilities and financial handholding of state government.
As part of health reforms and initiatives, public expenditure on health will be increased by investing in grass root health institutions and ramping up health and wellness centres in rural and urban areas. Infectious Diseases Hospital Blocks will be set up in all districts and strengthening of lab network and surveillance by integrated public health labs in all districts and block level labs and public health unit to manage pandemics. Further, national institutional platform for One Health by ICMR will encourage research while the National Digital Health Mission will ensure implementation of the National Digital Health Blueprint.
Technology Driven Education
PM eVIDYA, a programme for multi-mode access to digital/online education and Manodarpan, an initiative for psycho-social support for students, teachers and families for mental health and emotional well-being will be launched immediately. It is also planned to introduce a new national curriculum and pedagogical framework for school, early childhood and teachers. National Foundational Literacy and Numeracy Mission will be launched by December this year for ensuring that every child attains learning levels and outcomes in grade 5 by 2025.
Enhancing of Ease of Doing Business Through IBC
The government has raised the minimum threshold to initiate insolvency proceedings to Rs1 crore (from Rs1 lakh), which largely insulates MSMEs. Special insolvency resolution framework for MSMEs under Section 240A of the Code will be notified soon.
Fresh initiation of insolvency proceedings will be suspended for up to one year, depending upon the pandemic situation. Also, the central government will be empowered to exclude Covid-19 related debt from the definition of “default” under the Code for the purpose of triggering insolvency proceedings.
Decriminalisation of Defaults Under Companies A
Decriminalisation of Companies Act violations involving minor technical and procedural defaults such as shortcomings in CSR reporting, inadequacies in board report, filing defaults, delay in holding of AGM are some of the measures proposed. The amendments will de-clog the criminal courts and NCLT. Seven compoundable offences altogether dropped and five are to be dealt with under alternative framework.
Ease of Doing Business
Key reforms include:
- Direct listing of securities by Indian public companies in permissible foreign jurisdictions;
- Private companies which list NCDs on stock exchanges not to be regarded as listed companies;
- Including the provisions of Part IXA (Producer Companies) of Companies Act, 1956 in Companies Act, 2013;
- Power to create additional/ specialised benches for NCLAT; and
- Lower penalties for all defaults for small companies, one-person companies, producer companies and start-ups.
Public Sector Enterprise Policy for a New, Self-reliant India
A new policy to be announced by the government will:
- Notify a list of strategic sectors requiring presence of PSEs in public interest;
- In strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed;
- In other sectors, PSEs will be privatised (timing to be based on feasibility etc);
- To minimise costs, the number of PSEs in strategic sectors will ordinarily be only one to four; others will be privatised, merged/ brought under holding companies.
Support to State Governments
Centre has decided to increase borrowing limits of States from 3 per cent of their individual gross state domestic product to 5 per cent for the financial year 2020-21 only. This will give states extra resources of Rs 4.28 lakh crore. Part of the borrowing will be linked to specific reforms (including recommendations of the Finance Commiss ion).
Reform linkage will be in four areas: universalisation of ‘One Nation One Ration card’, Ease of Doing Business, Power distribution and Urban Local Body revenues.
While states will be allowed to draw an additional 0.5 per cent without fulfilling any conditions, the remaining will be in tranches subject to meeting certain conditions. Another 1 per cent can be drawn in four tranches of 0.25 per cent, with each tranche linked to clearly specified, measurable and feasible reform actions
Further 0.50 per cent if milestones are achieved in at least three out of four reform areas. The Department of Expenditure will notify specific details of the scheme.