Nirmala Sitharaman Highlights: FM announces LTC cash voucher scheme, special festive advance to boost GDP

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Updated: October 12, 2020 5:56:03 pm

FM Sitharaman Highlights: Government employees can use LTC cash voucher to buy items attracting 12 per cent or more GST, increasing consumer demand.

finance minister, nirmala sitharaman, economic issues, stimulus package, economic package, gdp, economy growthIndia’s fight against the pandemic was more difficult as the country was already carrying a burden of a prolonged slowdown.

Nirmala Sitharaman Highlights: Finance Minister Nirmala Sitharaman today announced that government employees can avail cash voucher for LTC if they can’t travel due to pandemic. Employees can use the money to buy items attracting 12 per cent or more GST, increasing consumer demand. However, employees can spend an LTC cash voucher only through digital mode and at places registered under GST before 31 March 2021. FM Sitharaman is addressing media on economic issues, ahead of the GST Council meeting scheduled later this evening. The government also announced that the north-east states will get 50-year interest-free loans of Rs 1,600 crore and Himachal Pradesh and Uttarakhand will get Rs 900 crore. The amount has to be spent by 31 march 2021. Other states will also get Rs 7,500 crore loans in proportion to their share in Finance Commission evolution. FM Sitharaman added that half of the amount will be disbursed initially and the second part will be disbursed once the previous amount is utilised. Further, the government increased the centre’s capital expenditure budget by Rs 25,000 crore from Rs 4.13 lakh crore for expenditure on the road, water supply, urban development, and defence infrastructure including manufacturing domestic equipment

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Highlights

    15:27 (IST)12 Oct 2020
    Multiplier effect on growth of trade, industry and economy likely

    The Government’s proposals to enhance capital expenditure in the country is highly appreciable as this will have a multiplier effect on the growth of trade, industry and economy; creating employment opportunities for the workforce: Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry.

    14:59 (IST)12 Oct 2020
    Govt to give Rs 12,000 cr interest-free 50-year loan to states for capital projects

    Finance Minister Nirmala Sitharman on Monday announced a Rs 12,000 crore interest-free 50-year loan to states for spending on capital projects in a bid to boost economy. Addressing a press conference, she said, out of the Rs 12,000 crore, Rs 1,600 crore will be given to north-eastern states and Rs 900 crore will be for Uttrakhand and Himachal Pradesh. She said Rs 7,500 crore will be for the remaining states. Rs 2,000 crore will be given to states that fulfill pre-stated reforms. Read full story here

    14:43 (IST)12 Oct 2020
    Power of choice, competitive price, bigger market opportunities for farmers

    Agriculture Bills empower the farmer with the power of choice, competitive price, and bigger market opportunities - Anurag Singh Thakur, MoS, Ministry of Finance.

    14:33 (IST)12 Oct 2020
    Expecting private sector and state governments to spend cannot be justified

    The festival advance with only a single condition of digital spending which is implemented through a rupay prepaid card, without any other frills, is definitely a welcome one and is expected to be well received by the salaried class. However, the estimate of the increase in demand of around Rs 36000 crores as against estimated spending of Rs 11500 crores by the central government seems to be overstated. In the current scenario, expecting the private sector and the state governments to spend a similar amount cannot be justified. Divakar Vijayasarathy, Founder and Managing Partner, DVS Advisors LLP

    14:25 (IST)12 Oct 2020
    Demand for consumer electronics will increase with today's stimulus

    We really appreciate FM’s Decision to give vouchers, they will lead to Consumerism. Demand for consumer electronics will increase with this stimulus due to limited choice to spend on travel and other entertainment. So mostly customers will spend on durables especially screens and appliances: Avneet Singh Marwah, Director, and CEO, Super Plastronics Pvt Ltd, a Kodak brand licensee.

    14:18 (IST)12 Oct 2020
    Announcements have come with a 'conditions apply' tag

    It is good to hear that the government has turned its attention towards the demand side. However, the announcements have come with a "conditions apply" tag. The thought process behind the LTC cash vouchers is to spend the money which ought to have been spent by the Govt or PSBs in the absence of the pandemic. The conditions of 3 times spending of LTC & 1 time of leave encashment on products and services of GST slab rate of 12% dampens the spirit. The condition of the 3 times spending of the LTC would only push the middle class salaried population to postpone the availing LTC to subsequent years in this block. -- Divakar Vijayasarathy, Founder and Managing Partner, DVS Advisors LLP

    14:12 (IST)12 Oct 2020
    Govt empoloyees can get cash amount worth three times of LTC ticket fare

    Government employees can opt for cash amount worth three times of ticket fare under LTC cash voucher: Govt

    14:05 (IST)12 Oct 2020
    SC issues notice to centre over new farm laws

    Supreme Court has issued notice to Centre. It will hear pleas against new farm laws after 6 weeks. SC has asked Attorney General to assist court on pleas contesting new farm laws.

    13:58 (IST)12 Oct 2020
    Conservative estimates on rising demand

    Estimates are made on a very conservative basis. Only 1/4th of employees will be claiming the benefit. We will be very happy if more employees claim the benefit, says Economic Affairs Secretary

    13:55 (IST)12 Oct 2020
    FM urges private sector to join hands in boosting demand

    We would request private sector to consider similar measures to help another Rs 28,000 cr demand, says FM Sitharaman

    13:54 (IST)12 Oct 2020
    Only 50 per cent of the states will give same benefits on LTC scheme

    Have assumed that only 50 per cent of the states will give same benefits on LTC scheme. Estimates also assume that private-sector impact (on LTC Scheme) is same as Central+State govt impact: Economic Affairs Secretary

    13:53 (IST)12 Oct 2020
    Cost of LTC cash voucher scheme

    For PSU banks, CPSE employees, today's scheme will cost Rs 1,900 crore and the same for state government employees will be Rs 9,000 crore.

    13:48 (IST)12 Oct 2020
    Significant impact can only be expected when outlays announced are actually spent

    Boosting consumer spending and raising government expenditure are the pillars of any growth revival. Government has taken commendable steps towards increasing demand in the economy. While consumer spending will get some push, a significant impact can only be expected when outlays announced are actually spent and a measurable increase in government spending on infrastructure and related projects takes place. Some revival push can definitely be expected from these measures: Archit Gupta, Founder and CEO - ClearTax

    13:46 (IST)12 Oct 2020
    Seventh pay commission does not include provision for festive advance

    The seventh pay commission does not include provision for festive advance but the government is rolling out a one-time measure of festive advance. It will not be a burden on the Centre as it will be recovered in 10 installments: FM Sitharaman

    13:41 (IST)12 Oct 2020
    What may encourage employees to take LTC cash voucher scheme?

    Central government employees are already heading towards the end of the 4-year block of LTC. This will encourage the employee to avail LTC cash voucher scheme: FM Sitharaman 

    13:37 (IST)12 Oct 2020
    Consumer demand may rise more than estimated now

    The government's estimates on a rise in consumer demand is on a conservative side: Govt

    13:33 (IST)12 Oct 2020
    LTC benefit for private-sector employees

    Since LTC benefit is available to private-sector employees as well, it is important for companies to look at their policies around Leave Travel concessions and amend them in line with the government's announcement to extend the tax benefits to its employees: Saraswathi Kasturirangan, Partner, Deloitte India.

    13:30 (IST)12 Oct 2020
    Today's solution must not cause tomorrow's problems

    Today's solution must not cause tomorrow's problems. Stimulus measures to not burden common citizens: FM Sitharman

    13:27 (IST)12 Oct 2020
    Common citizens not to be burdened by stimulus measures

    Measures to stimulate demand must not burden common citizens. Today's solution should not create tomorrow's problem: Govt 

    13:26 (IST)12 Oct 2020
    Demand boost of Rs 73,000 crore

    The total boost to the demand is estimated at around Rs 73,000 crore after today's announcement: FM Sitharaman

    13:24 (IST)12 Oct 2020
    Govt raises centre's capital expenditure budget by Rs 25,000 crore

    The government increased the centre's capital expenditure budget by Rs 25,000 crore from Rs 4.13 lakh crore for expenditure on road, water supply, urban development, and defence infrastructure including manufacturing domestic equipment: FM Sitharaman 

    13:17 (IST)12 Oct 2020
    Conditions to avail interest-free loans by states

    Half of the amount will be disbursed initially and the second part will be disbursed once the previous amount is utilised: FM Sitharaman

    13:15 (IST)12 Oct 2020
    Interest-free loans for other states

    Rs 7,500 crore for other states will get interest-free loans in proportion to share in Finance Commission evolution: FM Sitharaman

    13:14 (IST)12 Oct 2020
    North-east states get 50-year interest free loans

    North-east states to get 50-year interest free loans of Rs 1,600 crore and Himachal Pradesh and Uttarakhand will get Rs 900 crroe. The amount has to be spent by 31 march 2021: FM Sitharaman 

    13:10 (IST)12 Oct 2020
    FM Sitharaman on boosting capital expenditure

    Capital expenditure on infrastructure building has a greater multiplier effect on the economy and that's why it is one of the most favourable move: FM Sitharaman 

    13:07 (IST)12 Oct 2020
    Consumer demand is likely to get a boost of Rs 8,000 crore

    The consumer demand is likely to get a boost of Rs 8,000 crore due to festive advance to government employees. 

    13:06 (IST)12 Oct 2020
    Festive advance to be given as a prepaid credit in RuPay cards

    Employees will get interest-free festival advance as a prepaid credit in RuPay cards, not in cash that can be withdrawn from ATMs: FM Sitharaman.

    13:04 (IST)12 Oct 2020
    Festive advance can be repaid in 10 installments

    The central government can get festival advance to use till 31 March 2021. Employees will have to repay in 10 installments. 

    13:03 (IST)12 Oct 2020
    Festival advance for central government employees

    Government announces a one-time festive advance of Rs 10,000 for all central government employees, irrespective of designation. 

    12:59 (IST)12 Oct 2020
    Consumer demand to get a boost of Rs 28,000 crore

    Consumer demand of nearly Rs 28,000 crore will be generated from the LTC cash voucher scheme: FM Sitharman

    12:57 (IST)12 Oct 2020
    Increased consumer demand due to LTC cash voucher

    The consumer demand will get a boost of Rs 5,675 crore by central government employees availing the LTC cash voucher scheme and the same for PSUs will be Rs 1,900 crore.

    12:51 (IST)12 Oct 2020
    LTC cash voucher to be spent in digital mode

    Employees can spend LTC cash voucher only through digital mode and at places registered under GST before 31 March 2021: FM Sitharaman 

    12:49 (IST)12 Oct 2020
    Employees can avail cash voucher for LTC if they can't travel

    Employees can avail cash voucher for LTC if they can't travel due to pandemic. Employees can use the money to buy something of items attracting 12 per cent or more GST, increasing consumer demand: FM Sitharaman

    12:44 (IST)12 Oct 2020
    Pre-Diwali gift for consumers

    LTC cash voucher scheme and special festive advance scheme on today's cards: FM Sitharaman

    12:42 (IST)12 Oct 2020
    Stimulus measures for poor, weaker sections

    FM Sitharaman to make announcements for poor, weaker sections today. 

    12:40 (IST)12 Oct 2020
    FM begins address on economic issues

    FM starts speaking on economic issues, aims at boosting consumer demand.

    12:24 (IST)12 Oct 2020
    Stimulus measures ahead of festive season?

    FM Sitharaman is likely to announce some measures ahead of the festive season to boost demand, and is expected to present a report card on the state of the economy.

    12:21 (IST)12 Oct 2020
    FM Sitharaman to speak on economic issues soon

    Finance Minister Nirmala Sitharaman to address press conference soon. 

    12:13 (IST)12 Oct 2020
    Special liquidity for NBFCs

    A Special Liquidity Scheme was announced under which Rs 30,000 crore of investment were to be made by the government in both primary and secondary market transactions in investment-grade debt paper of Non-Banking Financial Companies (NBFCs), Housing Finance Companies (HFCs), and Micro Finance Institutions (MFIs). The central government assured to provide 100% guarantee for these securities.

    12:01 (IST)12 Oct 2020
    Collateral free loans for businesses

    The government announced collateral-free automatic loans of up to Rs 3lakh crore. through which MSMEs can borrow up to 20% of their entire outstanding credit as on February 29, 2020 from banks and Non-Banking Financial Companies (NBFCs). Borrowers with up to Rs 25 crore outstanding and Rs 100 crore turnover were eligible for such loans and could avail the scheme till October 31, 2020. Interest on the loan was to be capped and 100% credit guarantee on principal and interest were to be given to banks and NBFCs.

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