“Friends, amidst the Corona crisis, I am announcing today a special economic package with a new resolution. This economic package will serve as an important link in the ‘AtmaNirbhar Bharat Abhiyan” (Self Reliant India Campaign)’.” – Honourable Prime Minister of India, Shri Narendra Modi Address to the Nation on 12th May, 2020.
The term “åtmanirbharatā” re-entered the popular lexicon after the Honourable Prime Minister, Shri Narendra Modi’s speech to the nation on May 12th, 2020 (link). He announced an INR 20 Tn package titled “Atmanirbhar Bharat” that would concentrate five pillars upon which self-reliant India will stand upon:
The package was unveiled by the Honourable Finance Minister, Shri Nirmala Sitharaman through a series of five presentations that can be accessed here:
MSMEs Only; Startups May Apply
Startups were not specifically covered in the Atmanirbhar Bharat package. This is particularly curious as startups and new age businesses are slated to contribute $1 Tn in India’s quest to become a $5 Tn economy by 2025.
All the announcements in the package are geared towards MSMEs. But as per the changes made to the definition of the term MSME, there has been a broad alignment to the definition of a “startup”, thus opening the gateway for startups to register as MSMEs.
Procedure for registering as an MSME:
Ambiguity as per definition:
Differences in the definitions of a Startup and MSME
As per the revised definitions it is evident that startups are a subset of the universe of MSMEs. Thus, the enterprises who meet the definition of a “startup” as per “Startup India” will mainly qualify as an MSME and can avail of the registration as the same. Registrations will be required in order to be considered as an MSME.
INR 3 Lakh Cr Collateral Free Automatic Loans For Businesses, Including MSMEs
Businesses who have loans outstanding from Banks or NBFCs as of February 29, 2020
Not applicable to:
INR 20,000 Cr Subordinate Debt For Stressed MSMEs
INR 50,000 Cr Equity Infusion For MSMEs Through Fund of Funds
Fund of Funds Details:
TDS/TCS rates for non-salary payments reduced by 25%
Expedited Refunds to non-corporate businesses
Tax Filing Dates for FY19-20 extended:
Listing Related Changes:
Direct Listing abroad to be permitted for public companies:
Private Companies with listed debentures not to be considered as listed companies:
Other Company’s Act Matters:
Provident Fund Matters
The Atmanirbhar Bharat Package is a monumental effort to help Indians and the Indian economy tackle the COVID-19 scourge and lays the groundwork for India to become a $5 Tn economy by 2025.
“Friends, In our culture, it is said ‘सर्वम् आत्म र्शं सुखम्’ i.e. what is in our control, is happiness. Self-reliance leads to happiness, satisfaction and empowerment. Our responsibility to make the 21st century, the century of India, will be fulfilled by the pledge of self-reliant India. This responsibility will only get energy from the life force of 130 crore citizens. This era of self-reliant India will be a new vow for every Indian as well as a new festival. Now we have to move forward with a new resolve and determination. When ethics are filled with duty, the culmination of diligence, the capital of skills, then who can stop India from becoming self-reliant? We can make India a self-reliant nation. We will make India self-reliant. With this resolve, with this belief, I wish you the very best.” – Honourable Prime Minister of India, Shri Narendra Modi.
The scope of this note is limited to general areas of business and for measures that would be directly applicable to a majority of the portfolio companies. For specific measures for certain industries (agriculture, NBFCs, etc), kindly consult the presentation or reach out to the 3one4 Capital team. All founders are encouraged to go through the presentations for additional details.
Copyright © 2016 jax foundation - All Rights Reserved.