Economic Stimulus
Aatmanirbhar Bharat 3.0 will push job creation and stronger recovery of the economy: ASSOCHAM
New Delhi/IBNS: Government’s continuous support and the new announcements under the Aatmanirbhar Bharat Yojana 3.0 will make the road to recovery post-pandemic stronger and facilitate and incentivize job creation, and provide much relief and impetus to housing and infrastructure sector,” said Dr. Niranjan Hiranandani, President ASSOCHAM reacting to the announcement of the 7th major stimulus package to support the economy by the Union Finance Minister, Nirmala Sitharaman today in New Delhi.
“It is a good Diwali gift from the government,” he said.
FM announced 12 measures to counter the effects of Covid pandemic lockdown on the economy and people.
“Strong growth and an increase in demand have propelled the economy on a rebound.
“The effects of previous announcements Aatmanirbhar Bharat Abhiyaan 1.0 & 2.0 are clearly evident by the RBI’s prediction of a strong likelihood of economy returning to positive growth in Q3 rather than Q4 earlier by the quarter,” he said.
“The measures announced by today is a kind of relief the infra and housing industries were looking forward to. It would certainly push the sluggish demand in the housing sector and will also address the issue of unsold inventory in the sector. The announcement will also push the infrastructure sector out of the doldrums. The tax relief will take some pressure off the end-user and also the provider,” opined Dr. Hiranandani.
“The additional outlay of Rs 18000 crore for PMAY over and above the budget estimate will help lakhs of Indians in the urban and semi-urban area to fulfill their dream of a home in such a dire situation,” he said.
The center has announced tax relief for developers and first-time homebuyers for houses up to Rs 2 crore till June 30, 2021. And the differential between circle rate and agreement value in real estate income tax had been increased to 20 percent to boost housing sales.
Government is also going to infuse Rs 6,000 crore of equity in debt platform of National Infrastructure Investment Fund (NIIF) which will help NIIF raise Rs 1.1 lakh crore by 2025 for financing infrastructure projects. NIIF will also raise equity from private investors.
“We also welcome the very thoughtful decision of the FM to extend the Emergency Credit Line Guarantee Scheme (ECLGS) for MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), till March 31, 2021,” he said.
The Production Linked Incentive (PLI) that has been offered to 10 champion sectors and Credit Guarantee Support Scheme for the healthcare sector and other 26 stressed sectors affected by the pandemic will help revive these industries and ensure their survival,” said Dr. Hiranandani.
Dr. Hiranandani believes that by providing fertilizer subsidy of Rs 65,000 crore to farmers and Rs 900 crore for the research & development and of Covid vaccine, the government has once again proved that it does not let go off the focus on the core issues while taking care of the rest of the problem.
“The total stimulus provided by the Government and RBI is 15 percent of the GDP which has been our demand and suggestion right from the beginning,” he reiterated. So far the government has announced Rs. 29.87 lakh crore stimulus packages in 7 installments since the Covid lockdown.
He further said that the overall sentiments in the country and overseas is positive and that will help India draw more investments in the coming future for the better.
“The strong economic indicators are there for everyone to witness as Moody has also decided to reassess India’s growth numbers,” he added.
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