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FM Nirmala Sitharaman Announces Rs 70,000 Cr Package For Exports, Real Estate Sectors To Boost Growth

Mumbai: In a massive development, Finance Minister Nirmala Sitharaman announced a Rs 70,000 crore package for the export and real estate sectors, including the establishment of a stressed asset fund as the government pulled the economy from a six-year low Continued with fire fighting measures.

A fund of Rs 20,000 crore will be set up to provide half of the government’s money, for projects that are not in the bankruptcy court or have already been tagged as bad debt. The third set of measures to remove tensions in specific sectors and boost the economy.

In addition, the exemption rules allowed housing finance companies to borrow funds abroad while lowering the interest rate on housing building advances, benefiting government servants, who would become a major component of the demand for homes.

Around 3.5 lakh homebuyers will benefit from the stretcher asset fund, Sitharaman said, adding that buyers stuck in bankruptcy-bound projects will get relief through NCLT.

For exporters, a new scheme for reimbursement of taxes paid on exports, called exemption or tax on duties of the export product (RoDTEP), will come into force from January 2020 to replace existing disputes.

The new RoDTEP “will more than adequately encourage exporters with existing plans,” she said, adding the government to the scheme would be estimated at Rs 50,000 crore. The government is already providing Rs 40,000-45,000 crore of refunds under the existing schemes.

She added that in addition to this, the annual Export Credit Guarantee Corp (ECGC) of Rs 1,700 crore would allow banks to provide higher insurance cover to banks lending working capital for exports. He said that this would make a possible reduction in the total cost of export credit including interest rate, especially for MSMEs.

The priority sector lending tag for export credit is under consideration of the Reserve Bank, which will issue an additional Rs 36,000 crore to Rs 68,000 crore for export credit.

Other measures for exporters include a fully electronic withdrawal of input tax credits from the end of the month, an action plan to reduce export or turnaround time at airports and ports by December, and a special FTA utilization mission that will each include discounted rates. Will work with export houses to use. The Free Trade Agreement (FTA) is with various countries in India.

She also announced a mega shopping festival on the likes of the world-famous Dubai Shopping Festival, which will be held at four locations in India in March on themes of gems and jewellery, handicraft/yoga/tourism, textiles and leather.
The Finance Minister said that the measures announced on the last two occasions will help in uplifting the economy and the growth rate will improve in the second quarter.

Inflation, she said, is kept “very” below the 4 per cent mark and is “a clear sign” of revival in the economy, as has seen an increase in industrial production and fixed investment.

She said that measures are being taken to improve loan outflows from banks, which have also begun to cut interest rates to borrowers. Sitharaman will meet the heads of public sector lenders on September 19 to review the broadcast.

She said that measures are being taken to improve loan outflows from banks, which have also begun to cut interest rates to borrowers.

Sitharaman will meet the heads of public sector lenders on September 19 to review the broadcast.

(With PTI Inputs)

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