InvestorQ : What exactly did the government announce on Day-5 of the stimulus announcement by the Finance Minister?
diksha shah made post

What exactly did the government announce on Day-5 of the stimulus announcement by the Finance Minister?

Answer
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Crowny Pinto answered.
5 months ago


Day-5 of the stimulus announcement did not have much by way of allocations since most of the allocations had been completed by the end of Day 3. Here are some quick structural reforms that FM focused on Day-5.

· Additional funding of Rs.40,000 crore for the MGNREGS scheme to improve jobs and livelihood means in the rural areas.

· Government has announced that all districts will have infectious disease hospitals and public health labs at block-level for better primary healthcare.

· Specific COVID-19 related debt would be excluded from the definition of default under the IBC. There will be no new insolvencies in next one year.

· Violations under Companies Act will be substantially decriminalised. This will put less pressure on the entrepreneur taking the business risk.

· Companies permitted to directly list securities in foreign jurisdictions. This will benefit companies in the IT, pharma, biotechnology and ecommerce space.

· In a boost for privatization, all sectors hitherto reserved for PSUs will be opened to the private sector and role of PSUs to be limited to some critical areas.

· Borrowing limit of states to be hiked from 3% to 5% for FY21 to ensure resources of Rs.428,000 crore to states. States have used 14% of the limit only.

What would be really interesting is to see the overall impact on the fiscal deficit and how it is managed?