Nirmala Sitharaman Highlights: Diwali gift for jobseekers, urban poor; employment scheme, housing support and more

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Updated: November 12, 2020 6:19:40 pm

FM Sitharaman Highlights: Nirmala Sitharaman today said that 78 lakh more jobs will be generated by an additional capital outlay of Rs 18,000 crore under PMAY-Urban scheme.

nirmala sitharaman live, stimulus package, economic recovery, sector specific measures, pli scheme, incentivesFM Sitharaman's address comes a day after the government announced new production linked incentives under another Rs 2 lakh crore PLI scheme for 10 major manufacturing sectors.

Finance Minister Nirmala Sitharaman Highlights: Finance Minister Nirmala Sitharaman today announced the long-awaited stimulus package ahead of Diwali. FM Sitharaman rolled out 12 stimulus measures to boost employment in the formal and informal economy, boost housing infrastructure, enhancing ease of doing business, extending the deadline for the Credit Line Guarantee Scheme, etc. The address comes a day after the government announced new production linked incentives under another Rs 2 lakh crore PLI scheme for 10 major manufacturing sectors.  The government also concentrated on announcing some fresh projects, collaterally boosting employment in the country. Finance Minister today announced an additional outlay of Rs 18,000 crore for PMAYUrban, which will help ground 12 lakh houses and complete 18 lakh houses. The move will create additional 78 lakh jobs and improve production and sale of steel and cement, resulting in a multiplier effect on the economy, theMinister said. The government today announced stimulus packages worth Rs 2,65,080 crores. The overall cost of the packages announced till date stands at Rs 29,87,641, which is 15 per cent of GDP.

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Highlights

    18:19 (IST)12 Nov 2020
    Poultry sector asks govt for relief

    We strongly urge for a stimulus package to address the problems being faced by India’s poultry sector. The COVID-19 pandemic has dealt a serious blow to the poultry sector. The loss to the sector is estimated to be around INR 30,000 crore during the lockdown that mostly happened due to erroneous forwards and misinformation which claimed that the virus can pass to humans through consumption of chicken meat. On top of that, there were restrictions on inter-state travel that further impacted the delivery and supply of goods. Though the poultry industry is recovering slowly after the lockdown, demand is still low as sectors like catering (HORECA), restaurant and hospitality are yet to pick up their pace. -- Ramdas Kambale, Director- Sales – Asia Pacific; Board Member of Proteon Pharmaceuticals

    17:26 (IST)12 Nov 2020
    Today's announcement will help generate jobs, oil the engine of the economy

    We expect that the announcement will help generate jobs, oil the engine of the economy through extension of ECLGS 1.0 and introduction of ECLGS 2.0 exclusively for the stressed sectors and provide additional investment through PLI and capital expenditure along with relief on performance security and earnest money. The relief to developers and home buyers would stoke the Real Estate industry by clearing the unsold inventory, while the fertilizer subsidy would benefit the farmers in forthcoming Rabi and Kharif crops. Overall, the stimulus package would benefit the economy as a whole, steering it on a recovery path -- Naveen Kulkarni, Chief Investment Officer, Axis Securities

    17:24 (IST)12 Nov 2020
    Overall amount under the scheme likely remains capped at Rs 3 lakh crore

    The extension of the ECLGS to March 31, 2021, is welcome as the scheme has been useful for the MSMEs as seen by the offtake so far at Rs 2.5 lakh crores. However, the overall amount under the scheme likely remains capped at Rs 3 lakh crore. Further outlay on the PMAY-Urban is also welcome. These are a series of multiple steps each of which is positive for the economy and together it could continue to support the economic revival. -- Rajat Jain, Chief Investment Officer, Principal Asset Management 

    17:22 (IST)12 Nov 2020
    Focus on job creation is one of the major steps to stimulate economic growth

    The major focus is more towards the development and growth of existing businesses, especially MSMEs. A lot of people lost their jobs during this period, thus a focus on job creation is one of the major steps to stimulate economic growth and reduce the number of unemployment. Boosting rural employment with this round of stimulus by the government is also a welcoming decision by all of us. -- Rajesh Gupta, Co-founder and Director, Busy Accounting Software

    17:10 (IST)12 Nov 2020
    Long-term positive for equities, potentially negative for financials

    Overall, the measures announced today are long term positive for both the economy and equity market. Low allocation from budgetary resources makes the announcements positive for the government securities market as well. At the sector level, the announcements are positive for real estate, infrastructure, export-oriented and import-substituting sectors. The announcement today can potentially be negative for the financials if the government and the Reserve Bank of India resorts to moral suasion or more direct measures to nudge bank towards accelerated lending to the pandemic impacted sectors. -- Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers

    17:02 (IST)12 Nov 2020
    Calibrated measures, instead of a one-time measure is a better move

    Rather than providing stimulus through one big announcement (like most other countries), the Indian government and the Reserve Bank of India have opted to roll out supportive measure at different points of time depending on the state of the economy. Giving the uncertainties on the pandemic front and also the varying pace of economic recovery, we think this is the right move. -- Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers

    16:47 (IST)12 Nov 2020
    Govt's effort to boost economic growth in post-pandemic phase

    On the eve of Diwali, the Modi government’s continued focus on stimulating the economy is welcome news. This round of stimulus has a focus on job creation with its focus on the PLI schemes as well as the EPFO side. This will help stimulate economic growth in the coming quarters as the world looks to a post-pandemic world - By Harjiv Singh, Board member, GlobalPPEMart

    16:42 (IST)12 Nov 2020
    Govt enables environment for the recovery of the housing

    The fiscal stimulus 3.0 as part of Atmanirbhar Bharat mission has provided an enabling environment for the recovery of the housing, construction, and manufacturing sectors among others. The additional outlay of Rs 18,000 crore under the PMAY-U scheme is a welcome step that would help improve the housing market and aid job creation. Further, the government has focussed on strengthening the mass housing market, which is reflected in its decision to provide concessionary tax relief measures for developers and home buyers for houses up to Rs 2 crore. This has the potential to reinvigorate housing demand in the coming months, which would hopefully trigger new housing projects. - Anurag Mathur, CEO, Savills India 

    16:34 (IST)12 Nov 2020
    Demand side stimulus has been provided to sectors with multiplier effect

    As anticipated, now the demand side stimulus has been provided with emphasis on spending in the sectors and industries which would have a multiplier effect to revive the entire economy including rural sector and manufacturing. A multi-pronged approach has been adopted to address the urgent issues of employment, exports, housing etc. The importance of construction and infrastructure also indicates the long term strategy while at the same time addressing the sustainability angle and handling the covid situation. -- Jyoti Prakash Gadia, Managing Director at Resurgent India

    16:31 (IST)12 Nov 2020
    India should break out of the low-productivity cycle

    There is a short window of opportunity for India to capitalize on the temporary pressures that China’s supply chain has come under due to high wage costs. To capitalize on this, India should break out of the low-productivity cycle by addressing problems with infrastructure, labour, and credit availability. Today’s announcements by the Finance Minister demonstrate that the government recognizes these three as problem areas. But incentives and stimulus packages, while necessary, offer ephemeral gains. Therefore, the emphasis should now shift to transforming the economy through deeper, systemic reform. -- Hemant Krishna, Joint Partner, Lakshmikumaran & Sridharan Attorneys

    16:26 (IST)12 Nov 2020
    Prices of new homes may come down

    Today’s announcements by the FM addressed concerns over job creation, liquidity, the slowdown in the rural economy and infrastructure development. The additional allocations under the PM Awas Yojna combined with tax sops for purchase of primary residential units upto Rs 2 crore, significantly reduces the cost of acquiring a new home and provides relief to the real estate sector, which was burdened with high inventory. -- Jaspal Bindra, Executive Chairman, Centrum Group

    16:17 (IST)12 Nov 2020
    Impact of today's announcemnt on real estate will be limited due to this reason

    Earlier this year in the Budget, the Government had provided tax relief to home buyers if the agreement value was up to 10% lower than the circle rate. With the softening of prices across markets, this price difference was in excess of 10% in some cases which kept some of the home buyers at bay. The Government has increased this limit from 10% to 20% for property value within Rs 2 crore. While this will certainly help the real estate sector liquidate inventory as it brings more home buyers to the fore, the impact will be limited as unsold inventory is highest in Mumbai and NCR markets where property values are higher than Rs 2 cr. -- Sharad Mittal, CEO & Head, Motilal Oswal Real Estate

    16:07 (IST)12 Nov 2020
    Measures towards increasing India's competitiveness, building ‘Self Reliant’ India'.

    The infrastructure debt financing support announced by the government in the form of Rs 6000 Cr equity will attract more investments in infrastructure development. All these measures will collectively improve India's competitiveness and will go a long way in boosting the initiative to build a ‘Self Reliant’ India'. -- Anshuman Magazine, Chairman & CEO - India, South East Asia, Middle East & Africa, CBRE

    16:03 (IST)12 Nov 2020
    PM Awas Yojana to have multiplier effect on economy

    The announcement of an additional outlay of Rs 18,000 crore for PM Awas Yojana(urban) is a step in the right direction towards fulfilling the vision of Housing for all, which will lead to generating employment along with supporting other industries, having a multiplier effect on the economy. Income Tax relief for developers and home buyers will encourage transactions and attract first time homebuyers. -- Anshuman Magazine, Chairman & CEO - India, South East Asia, Middle East & Africa, CBRE

    15:54 (IST)12 Nov 2020
    Incentives announced today will provide a boost to R&D in new areas and help attract investment

    While India has always been at the forefront of generic drug manufacturing, there was a felt need for India to move up the value chain. The new PLI scheme will focus on providing incentives for the manufacture of complex generics and Biosimilars, which are the future of Pharmaceuticals. These incentives will provide a boost to R&D in newer areas and help attract investment in cutting edge technology and create a viable ecosystem for India to become a global player -- Charu Sehgal, Partner and Lifesciences and Healthcare Industry Leader, Deloitte India

    15:31 (IST)12 Nov 2020
    FM makes Diwali more cheerful for real estate sector

    The announcement by the Finance Minister has made Diwali truly cheerful for the Real Estate Industry. While the initiatives provided earlier had set the wheels moving and few state Governments had also reduced the stamp duty to give added benefits, the circle rates in cities like Mumbai were still creating a barrier for homebuyers to make the purchase. With this announcement of increasing the differential between the circle rates and agreement rates to 20% from 10%, the affordable residential housing segment is surely expected to witness an uptick and buyers can make an informed decision which will eventually help them to save their taxes. Additionally, FM’s impetus to the PMAY-U will help create housing demand in Tier II & III cities and employment in allied industries.-- Farshid Cooper, MD, Spenta Corporation

    15:29 (IST)12 Nov 2020
    FM's announcement will bring uptick in purchase of residential property

    Some of the schemes were very targeted, like the amendment to the income tax act on the difference in the circle rate and agreement rate, and I am hopeful, this will bring an uptick in the purchase of a residential property. Overall, most of the package can be implemented quickly and the benefits will pass on to the industry and citizens fairly soon. -- Gaurav Taneja, Partner and National Leader, Government and Public Services, EY India

    15:28 (IST)12 Nov 2020
    Today's move beneficial to 28 stressed sectors

    The package announced by the Finance ministry is holistic, timely and a welcome move. It continues with existing schemes which have had a positive impact on-ground, in fact widens their scope like the credit guarantee scheme. This will be particularly beneficial to the 28 stressed sectors which were identified earlier. In addition, it builds on the infrastructure, agriculture & rural development, housing and manufacturing themes from Atmanirbhar 2.0. -- Gaurav Taneja, Partner and National Leader, Government and Public Services, EY India

    15:19 (IST)12 Nov 2020
    Aatmanibar Bharat Rozgar Yojana will incentivise companies to create job opportunities for the less fortunate

    Today's move will surely accelerate the economic recovery. The new Aatmanibar Bharat Rozgar Yojana will incentivise companies to create job opportunities for the less fortunate and marginalised sections of our society. -- Arjun Ranga, Managing Director, Cycle Pure Agarbathi

    15:17 (IST)12 Nov 2020
    More than the Atma Nirbhar Bharat 1.0 & 2.0, the third package can be expected to have profound impact

    The capital infusion of around Rs. 10,200 crores for specific sectors such as defence manufacturing, etc. is continuation of the steps to encourage domestic manufacturing. More than the Atma Nirbhar Bharat 1.0 & 2.0, the third package can be expected to have profound impact since the economic activity is steadily improving. -- Divakar Vijayasarathy, Founder & Managing Partner, DVS Advisors LLP

    15:16 (IST)12 Nov 2020
    Infrastructure & real estate is a clear winner in today's announcement

    Infrastructure & real estate is a clear winner with many announcements such as equity infusion into the infrastructure fund, amendment in Income Tax Act for real estate sector, reduction in EMD & performance guarantee, etc. Some of the announcements are extensions of existing schemes; however, few new schemes such as the subsidy for both employee & employer contribution to EPF with a condition of additional recruitment, have been introduced. This would go a long way in reducing the cost of production viewed in toto with the PLI scheme and other announcements. -- Divakar Vijayasarathy, Founder & Managing Partner, DVS Advisors LLP

    15:09 (IST)12 Nov 2020
    PF subsidy under the Atmanirbhar Bharat Rozgar Yojana will help stressed sector

    The PF subsidy under the Atmanirbhar Bharat Rozgar Yojana will augur well in helping the stressed sector (which is one of the largest employer) in controlling its cost. Further, the SWAMIH scheme has started to see real traction and with 135 projects already approved and many more in the pipeline, there is good news for both types of the homeowners - (i) looking to buy a new home now and (ii) one who have bought home in a stuck project

    -- Piyush Bothra, co-founder & CFO Square Yards.

    15:07 (IST)12 Nov 2020
    Multiplier effect on real esate sector

    Today's stimulus package has focused well on the real estate sector which has significant multiplier impact on the economy due to its high employment generation capabilities. The increased outlay under PMAY (U) coupled with the increased gap vis-a-vis the circle rate of 20% would give significant boost to the real estate sales specially in the mid to low price brackets. - Piyush Bothra, co-founder & CFO Square Yards.

    14:58 (IST)12 Nov 2020
    78 lakh more jobs to generate with new capital outlay under PMAY-Urban

    Finance Minister today announced an additional outlay of Rs 18,000 crore for PMAYUrban, which will help ground 12 lakh houses and complete 18 lakh houses. The move will create additional 78 lakh jobs and improve production and sale of steel and cement, resulting in multiplier effect on economy. 

    14:54 (IST)12 Nov 2020
    Rs 10,200 crore additional budget stimulus for capital and industrial expenditure

    Rs 10,200 crore additional budget stimulus will be provided for capital and industrial expenditure on defence equipment, industrial infrastructure and green energy: FM Sitharaman

    14:44 (IST)12 Nov 2020
    Outlay of stimulus package announced till date
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    14:37 (IST)12 Nov 2020
    26 stressed sectors due to Covid 19, identified by Kamath Committee, get credit support

    Once active Covid cases have substantially declined, rightly the focus now is more towards giving a kick start the economy to top gear. In September 2020, Kamath Committee appointed by RBI, had identified 26 sectors which were directly impacted by Covid, like power, construction, iron and steel, roads, real estate, wholesale trading, textiles, consumer durables, aviation, logistics, hotels, restaurants and tourism etc. Companies in those sectors, including health, with credit up to Rs 500 crore and categorised as SMA 0 (default less than 30 days) as on 29th Feb 2020, will be eligible for additional guaranteed credit which can be repaid over five years including one-year moratorium. - Hari Hara Mishra, Policy Analyst and Columnist

    14:35 (IST)12 Nov 2020
    15% of GDP given as stimulus package

    The government announced a stimulus package worth Rs 2,65,080 crores today. The overall cost of the packages announced till date stands at Rs 29,87,641.

    14:32 (IST)12 Nov 2020
    Rs 900 crore for research and development for Covid vaccine

    The governmnet announced Rs 900 crore for research and development for Covid vaccine. The money will go to the department of biotechnology for research purposes.

    14:30 (IST)12 Nov 2020
    Govt announces Rs 10,200 crore for industrial expenditure

    The government today announced an additional outlay of Rs 10,200 crore for the domestic defence equipment manufacturer, industrial expenditure, green energy sector etc. 

    14:27 (IST)12 Nov 2020
    Govt's effort to lift rural economy

    An additional outlay of Rs 10,000 crore is being provided for PM Garib Kalyan Rozgar Yojana. Funds can be used for MGNREGA or for Gram Sadak Yojana, will help accelerate rural economy: FM Sitharaman

    14:25 (IST)12 Nov 2020
    Govt's effort for boosting exports; gives Rs 3,000 crore to EXIM banks

    The government announced Rs 3,000 crore to EXIM banks to extend lines of credit to boost exports. 

    14:24 (IST)12 Nov 2020
    Promoting ease of doing business

    To provide ease of doing business and relief to contractors whose money otherwise remains locked up, performance security on contracts will be reduced to 3%, said FM Sitharaman. EMD for tenders will be replaced by bid security self-declaration and the relaxations will be till December 31, 2021.

    14:22 (IST)12 Nov 2020
    Govt announces Rs 10,000 crore to boost informal employment

    During lockdown, PM Garib Kalyan Rozgar Yojana helped migrant workers in 116 districts. Now, the government announced Rs 10,000 crore for boosting informal employment.

    14:17 (IST)12 Nov 2020
    Govt announces Rs 65,000 crore for fertilizer subsidy

    While farmers are reaping benefit of favourable monsoon, the government announced Rs 65,000 crore for fertilizer subsidy for adequate supply to farmers. - FM

    14:14 (IST)12 Nov 2020
    Debt financing for NIA

    The government today announced Rs 6,000 crore equity investment for debt platform for NIA. A total of Rs 1.1 lakh crore will be received under overall equity investments. 

    14:12 (IST)12 Nov 2020
    Support for construction & infrastructure

    Support for Construction & Infrastructure-Performance security on contract to be reduced to 3% instead of 5%. Earnest Money Deposit will not be required for tenders and will be replaced by Bid Security Declaration. Relaxations will be given till 31st December 2021: FM Sitharaman

    14:10 (IST)12 Nov 2020
    Income tax relief for taxpayers, homebuyers

    The differential between circle rate and agreement rate is now increased from 10% to 20%. Government said that the move will help the middle class while buying houses. 

    14:06 (IST)12 Nov 2020
    Credit guarantee support scheme for healthcare sector

    We are launching credit guarantee support scheme for healthcare sector and 26 sectors stressed due to #COVID19, says FM. Entities will get additional credit up to 20% of outstanding credit, repayment can be done in five years' time (1 year moratorium + 4 years repayment)

    14:01 (IST)12 Nov 2020
    FM announces new measures under PM Awas Yojana Arpan

    Rs 18,000 crore announced to build 12 lakh more houses and completing 18 lakh houses, creating additional jobs and consuming more steel and cement.

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