Prime Minister Narendra Modi chaired a high-level cabinet meet which saw some of the important decisions taken regarding the MSME and agricultural sector.
The meeting was held in the wake of the year anniversary of the Narendra Modi-led BJP government’s second term. The meeting also comes after the government announced its guidelines under ‘Unlock 1.0’ – the first phase of its exit plan. The phase is also being termed as the fifth phase of the lockdown. The Cabinet Committee on Economic Affairs (CCEA) was conducted at the Prime Minister’s residence and had the likes of Prakash Javadekar and Nitin Gadkari.
While briefing the press about the cabinet meeting, the government stressed that its topmost priority is the poor of the country. Most of the decisions taken in the cabinet meeting are in relation to the agricultural and MSME sectors.
Here are some of the highlights from the Cabinet meeting:
- The Cabinet approved the extension of the repayment date for the agricultural short term loans that have become due between the 1st of March to 31st August 2020.
- The Cabinet also decided to hike the MSP of paddy by 53 rupees by quintal that takes it to 1,868 rupees for the year of 2020-21.
- The MSMEs will be encouraged to go to stock markets. The Cabinet approved a distressed asset fund of 4,000 crores for MSMEs.
- The definition of MSME that was changed a week ago by the Finance minister has been changed again. As per the new definition, the turnover limit for medium enterprises has been revised to 250 crores.
- Farmers to get 50-83 percent more cost as the Cabinet approved MSP for 14 Kharif crops.
- A 50,000 crore rupee equity infusion has been approved by the cabinet for MSMEs which will strengthen and enable the MSMEs to get listed on stock exchanges for the first time.
- A 20,000 crore of subordinated debt fund has been approved by the Cabinet for stressed MSMEs that are likely to benefit 2 lakh MSME units.
- The promoters of MSME will be given debt by banks which will then be infused as equity by promoters.
- The functioning of those MSMEs that are NPA will be eligible for the stressed assets package.