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Nirmala Sitharaman Press Conference Highlights: The Union Finance Minister listed 12 new measures on November 12 as a part of the stimulus package during the COVID-19 outbreak. The Centre announced another stimulus package worth Rs 2.65 lakh crore, as a part of Atmanirbhar Bharat 3.0. This amount includes the ProductionLinked Incentive (PLI) scheme announced on November 11. Sitharaman said the economy is seeing strong recovery, and COVID-19 active cases are declining. The Centre and Reserve Bank of India (RBI) have together provided total fiscal stimulus of Rs 29.87 lakh crore since the COVID-19 pandemic began. This amount is 15 percent of India's gross domestic product (GDP), Sitharaman said.
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“The latest round of stimulus package by the Government is a bouquet of measures that incentivizes job creation in the informal sector, expands the supply of loanable funds through enlargement of credit guarantee scheme to support stressed sectors and a strong push to real estate, with tax incentives for home buyers that could potentially unleash a price discovery in the real estate market. The Government also proposes to enlarge the rural employment scheme that could continue to support rural recovery. The support for project exports could potentially widen the risk-taking capabilities of EXIM Bank. Overall, these measures will ensure that we continue to take steps towards a sustained economic recovery.”
"Finance MinisterNirmalaSitharaman'sstimulus measures in terms of income tax relief for buyers and developers is very timely and will further boost the housing demand in the country. The income tax relief of up to 20 per cent for homes costing up to ₹ 2 crore available till June 30, 2021 will bring in much needed fresh buying in the sector. This move to incentivize buyers will ensure the first-time home buyers and fence sitters to also enter the market resulting into good sales in next few quarters. The additional outlay underPMAYwill help the completion of stuck projects, create new jobs, and boost demand for raw materials."
“The prolonged COVID-19 crisis and anticipation for the vaccine has kept consumer demand on tenterhooks. However, the government and central bank measures since the pandemic outbreak have been encouraging and in the right direction to support industry and boost consumer demand. Today’s stimulus measures will aid job creation and infrastructure development in the country. Recognition of real estate as a core sector, creating ancillary industry demand and employment, and enhanced Pradhan Mantri Awas Yojana – Urban allocation, will boost the housing demand in the country. Besides, the increase in circle rate and transaction value threshold from 10% to 20% will remove a transaction hurdle and save tax thereby increasing the opportunity for unbridled property purchase activity.”
“Finance MinisterNirmalaSitharaman’sannouncement, about additional funding of Rs. 18,000 crore for PMAwaasYojana-Urbanwill add to the sparkle this festive season. This is over and above the Rs 8,000 already allotted this year, and will translate into more homes for home seekers, more employment opportunities as also good business for suppliers and industries peripheral to real estate and construction.”
Most banking stocks continued trading in the red in afternoon trade on November 12 even as the Finance MinisterNirmalaSitharamanannounced fresh stimulus measures.
Nifty Bank index was about 2 percent down around 1415 hours, with all stocks in the red. Shares ofKotakMahindraBank, Bank of Baroda,ICICIBank, State Bank of India,IndusIndBank and Axis Bank were down over 2 percent each.
Read more about the market reaction to the FM's presser
Stating that the economy is seeing strong recovery, and COVID-19 active cases are declining, the finance minister said, "Fertiliser consumption is going up significantly, an increased supply of fertilisers will ensure that forthcoming crop seasons will not be affected for want of adequate fertilisers."
Theminister noted that a 17.8 percent increase in fertiliser usage against actual usage of 571 lakh metric tonnes in 2019-20 has been recorded.
The Centre and Reserve Bank of India (RBI) have together provided total fiscal stimulus of Rs 29.87 lakh crore since the COVID-19 pandemic began. This amount is 15 percent of India’s gross domestic product (GDP), Finance Minister Nirmala Sitharaman said.
Under Atmanirbhar Bharat 3.0, the fiscal stimulus isRs 2.65 lakh crore, which includes the PLI scheme annoucend on November 11.
Read more about the total fiscal stimulus here
During the media briefing, the Union Finance Ministerhad referred to Moody's economic outlook for India.Moody’s Investors Service, on November 12, revised India’s Gross Domestic Product (GDP) forecast upwards for calendar year 2020 to -8.9 percent from the -9.6 percent contraction estimatedearlier.India’s GDP forecast for calendar year 2021 was similarly revised to 8.6 percent from 8.1 percent predicted earlier. The economy had contracted by about 23.9 percent in the April-June quarter and is earlier seen contracting more than 10 percent in FY2021. This was largely due to the impact of the nationwide lockdown imposed to curb the spread of thenovel coronavirus outbreak.
The governmentannounced an additional outlay of Rs 18,000 crore for Pradhan Mantri Awas Yojana (Urban), which means this amount will be provided over and above the budget estimate which was mentioned in the Budget 2020-21.
The decision will help ground 12 lakh houses and complete 18 lakh houses, said the union minister during a press conference on November 12.
“A number of measures have been taken in the past several months for revival of the Housing and Real Estate Sector. These measures have contributed to fair recovery in this sector,” said Sitharaman.
Here are 6 out of the 12 announcements made by Sitharaman:
> Rs 900 crore R&D grant for COVID-19 vaccine development, which will be given to The Department of Biotechnology.
> Rs 65,000 crore fertilizer subsidy will be provided to farmers. Increased supply of fertilisers at subsidised rates will help 140 million farmers.
> Rs 6,000 crore equity investment in debt platform of NIIF, which will help NIIF raise Rs 1.1 lakh crore by 2025 for financing infrastructure projects
> Additional outlay of Rs 10,000 crore for PM Garib Kalyan Yojana.
> Rs 3,000 crore boost to be given for project exports through assistance given by India to developing countries under IDEAS Scheme
> Rs 10,200 crore additional budget stimulus to be provided for capital and industrial expenditure on defence equipment, industrial infrastructure and green energy
Here are 6 out of the 12 announcements made by Sitharaman:
> Atmanirbhar Bharat Rozgar Yojana toincentivisethe creation of new employment opportunities during the COVID-19 recovery phase
> The Emergency Credit Line Guarantee Scheme (ECLGS) for MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), has been extended till March 31, 2021.
> Credit guarantee support scheme for health care sector and 26 sectors stressed due to COVID-19.
> Production Linked Incentive (PLI) worth Rs 1.46 lakh crore is being offered to 10 champion sectors. A total amount of nearly 1.5 lakh crore has been earmarked across sectors, for next five years.
> The differential between circle rate and agreement value in real estate income tax had been increased to 20 percent to boost housing sales. Income tax relief for first-time buyers, developers, on houses up to Rs 2 crore till June 30, 2021
> Additional outlay of Rs 18,000 crore for PM Awaas Yojana Urban.
