Cabinet approves Rs 3 lakh cr funding for MSMEs, special liquidity scheme for NBFCs

The Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday approved a series of measures announced in the government's fiscal stimulus package worth Rs 20 lakh crore. Among the key proposals approved today include additional funding of up to Rs 3 lakh crore to MSMEs and MUDRA borrowers; a special liquidity scheme for non-banking financial companies and housing finance companies; allocation of foodgrains to migrants; adoption of auction methodology of coal and lignite mines; and a formalisation scheme worth Rs10,000 crore for the unorganised sector's micro food processing enterprises.

Finance Minister Nirmala Sitharaman on May 13 announced a slew of economic measures to support stressed Micro, Small and Medium Enterprises (MSMEs) and allocated Rs 3 lakh crore collateral-free automatic loans for businesses, including MSMEs, which she said would benefit 45 lakh units. The free foodgrain scheme, applicable for the next two months, will benefit about 8 crore migrants. The move will cost the government Rs 3,500 crore . The government had also announced auction of 50 coal blocks in the country, while allowing private players to bid too.

Also read: Coronavirus impact: Every sector will benefit from Rs 20 lakh crore package, says Sitharaman

Principal Spokesperson KS Dhatwalia said the Cabinet also approved the issuance of the Jammu And Kashmir Reorganisation (Adaptation of State Laws) Second Order, 2020, in the relation of J&K Civil Services (Decentralisation and Recruitment) Act. A scheme to bring about blue revolution through sustainable and responsible development of fisheries section in India also got the Cabinet nod.

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The Cabinet also approved modifications in the existing 'Partial Credit Guarantee Scheme' - a portfolio guarantee for purchase by PSBs of bonds or commercial papers (cps) with a rating of AA and below. The government has also extended the Pradhan Mantri Vaya Vandana Yojana up to March 31, 2023, beyond March 31, 2020. This will provide old-age income security and support to senior citizens. The government also approved the interest waiver of Hindustan Organic Chemicals Limited.

Prime Minister Narendra Modi on May 12 announced the mega fiscal stimulus for the country facing an unprecedented economic crisis due to the coronavirus pandemic, saying it was aimed at making India a "self-reliant nation".

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