To Revive India's Economy, Finance Minister Announces Cheaper Loan, Relief For Investors
On Friday, August 23, Nirmala Sitharaman announced certain measures to reverse the state of Indian Economy. She said the country’s economy is growing at a faster rate than any other major world economy.
At a press conference in New Delhi, Nirmala Sitharaman along with other senior officers of the finance ministry announced certain measures for robust growth of the economy.
The focus of the press conference was on investment, both foreign and domestic. Nirmala Sithsraman announced rollback of surcharge of both long term and short term capital gains. This was also a primary focus in the Union Budget.
It was estimated that the surcharge had an adverse impact on the foreign portfolio investors (FPIs). The FPIs have withdrawn Rs 23,000 crore from domestic markets post-Budget. The Budget announcement of surcharge on higher tax-income groups affected 40 per cent of FPIs.
“Pre-Budget position is restored,” Nirmala Sitharaman said.
Sitharaman announced a booster investment of Rs 100 lakh crore on building modern infrastructure over the next five years. An inter-ministerial task force will be created to push infrastructure projects which will boost growth and create jobs.
Government will infuse upfront Rs 70,000 crore into public sector banks to combat liquidity crunch, Sitharaman said. She said the move will enable release of Rs 5 lakh crore in the market.
All tax notices to be issued from centralised system to ‘end harassment of taxpayers’. All old tax notices will be decided by October 1 through the centralised system.
In another important announcement, Sitharaman spoke about alleged harassment of taxpayers saying that from October 1, all notices, summons, and orders of the Income Tax Department will be issued through a centralised computer system. It will also have a computer generated unique Document Identification Number (DIN).
Withdrawal of enhanced surcharge levied on FPIs announced, restoring pre-Budget position is being done to encourage investment in the capital market, the finance minister said.
Sitharaman said all pending GST refund due to micro, small and medium enterprises (MSMEs) will be paid within 30 days. In future, GST refund on new application will be paid within 60 days.
Decline in consumption has been the major reason for economic slowdown – which Sitharaman dismissed saying India is on fast track of growth while the global economy is slowing down. To boost consumption, Sitharaman announced some measures for cheaper loans and increase government expenditure.
Banks will offer cheaper loans for purchasing vehicles, houses and consumer goods. The non-banking financial companies (NBFCs) can now use Aadhaar-enabled KYC for onboarding customers.
Nirmala Sitharaman also announced revoking ban on the purchase of vehicles by government departments, which will now replace the old vehicles with new ones.
Sitharaman made another significant announcement with regard to non-compliance of corporate social responsibility (CSR). She said violations of CSR norms under the companies act will not be a criminal offence. It will be treated only as a civil liability.