Government has asked the heads of large PSU companies to stick to their respective capital expenditure plans and accelerate the investment activities.
In its continuing efforts to provide immediate support to a weakening economy, the government has asked the heads of large PSU companies to stick to their respective capital expenditure plans and accelerate the investment activities. The finance ministry will also monitor the release of payments for procurements and other contracts immediately, which would help to pump in liquidity in the system. The outstanding payments held up due to disputes are also to be resolved soon, said the Ministry of Finance in a statement. It has announced these steps as the extension of the measures taken earlier to boost investment and demand in the economy, which remains subdued due to domestic and global factors.
The meeting held today with the Maharatna and Navratna PSU companies’ heads and the financial advisors of infrastructure ministries, was co-chaired by Atanu Chakraborty, Secretary, Department of Economic Affairs, and GC Murmu, Secretary Department of Expenditure. The finance ministry has also assured that the government will constantly monitor the progress of large infrastructure projects and further follow-up meetings will also be held. The ministry will develop a dashboard to enable ministries to upload figures on periodic basis. Prior to this meeting, the expenditure secretary and the secretary of DEA also co-chaired a meeting with the heads of large PSUs, officials of the Ministry of MSME and the Ministry of Public Enterprises.
The government has said in a press release that the enhanced credit flow will spur investments cycle and help to revive the sectors such as housing, automobile, which are under stress. Finance Minister Nirmala Sitharaman has previously announced to recapitalise banks with Rs 70,000 crore. The government has also announced the merger of PSU banks. In another move, to provide ease in doing business, startups have been exempted from ‘angel tax’. Permission of 100 per cent FDI in many sectors have been granted and the interest rates have also been cut multiple times, to boost borrowing and thus investments. However, the slowdown caused by domestic and global factors have kept the current growth of the economy under stress.