FM Press Conference: Special Rs 10,000 crore window to fund incomplete housing projects

Major announcements for housing and the export sector

Finance Minister Nirmala Sitharaman today made several major announcements that will help in boosting the housing and export sector.

The measures include Rs 10,000 crore special window for extending funds to incomplete housing projects. The announcements come in the wake of the Indian economy’s sharp slowdown.

Nirmala Sitharaman

In the latest quarter, Gross Domestic Product growth slipped to a six-year low of 5 percent. Several sectors namely auto and real estate are grappling with a sharp slowdown in demand. In the last few weeks, the centre has announced a series of measures, such as front-loading of public expenditure, and improved access to credit for businesses and capital infusion into state-run banks to boost credit.

The centre had also relaxed foreign direct investment (FDI) rules in many sectors to achieve economic growth back on track.

The Reserve Bank of India the projected GDP growth for this fiscal to 6.9 percent, while most analysts and financial institutions have estimated 6.5-7 percent growth.

The Union Finance Minister said signs of recovery are observed in industrial production and fixed investment.

The finance minister also said that inflation has been kept under 4 percent. And several Non-Banking Financial Companies (NBFCs) are getting benefitted from partial credit guarantee schemes announced earlier.

Transmission of RBI repo rate cuts are being affected by banks, she said.

Here are the key announcements made by Finance Minister Nirmala Sitharaman today:

-Measures are being taken to improve credit outflows from banks

-Transmission of interest rate cuts are being affected by banks

-Exports: Scheme for Remission of Duties or Taxes on Export Product (RoDTEP) will replace the MEIS scheme

-Textile and other sectors that currently, enjoy incentives up to 2 percent over MEIS will transit to RoDTEP from 1 January, 2020

-New export incentive scheme to replace Merchandise Exports from India Scheme

-Merchandise Exports from India Scheme or MEIS scheme to continue till 31 December

-Up to Rs 50,000 crore will go through new RoDTEP scheme or Revenue foregone projected at up to Rs 50,000 crore

-The fully electronic refund scheme on input tax for exporters will be in place by end of this month

-This is expected to speed up input tax credit refunds for exporters

-The scope of Export Credit Insurance Scheme (ESIC) by ECGC will be expanded

-Revised Priority Sector Lending (PSL) norms for Export Credit – This will release an additional ₹36,000 crore to ₹68,000 crore as export credit under the priority sector

-Export finance will be actively monitored by an inter-ministerial working group in Dept of Commerce, tracked through a dashboard

-Free Trade Agreements or FTA Utilisation Mission, headed by a senior officer in the Department of Commerce, to be set up

-Online “Original Management System” for exporters will enable them to obtain Certificates of Origin will be launched in the next few weeks

-This is expected to develop ease of doing business for exporters

-There will be time-bound adoption by industry of all necessary mandatory technical standards

-Effective implementation will escalate the quality and performance, enhance competitiveness and address the issue of sub-standard imports

-India to organise annual mega shopping festivals like Dubai Shopping Festival to boost exports

-Centre to cut turnaround time in ports, airports via the use of technology

–  Centre to enable handicrafts industry to effectively harness e-commerce for exports

-Special Rs 10,000 crore window to extend funding to incomplete housing projects

– Rs 10,000 crore will be contributed by the Government and roughly the same amount will come from outside investors

-The aim is to focus on construction of unfinished units

-The special window will offer funding to net-worth positive housing projects (non-NPA and non-NCLT projects) in the affordable and middle-income category

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