New Delhi: The Narendra Modi government, elected for the second term with a thumping majority completed 50 days in power on Sunday.
Let's have a look at the economic achievements and goals of Modi 2.0 after being sworn in for the second time.
Roadmap for USD 5 trillion economy by 2025
In the Union Budget 2019 Modi government laid its vision to pave a pathway for India to become a USD 5 trillion dollar economy by 2025, which will make India the third-largest economy in the world. In 2013-14, India was the 11th largest economy in the world and today it hold the spot of the 6th largest economy in the world. To achieve the objective of becoming a USD 5 trillion economy by 2024-25, as laid down by the Prime Minister, India needs to sustain a real GDP growth rate of 8%, the Economic Survey has pointed out.
The government has proposed to extend the lower rate of 25 percent Corporate Tax to all companies with annual turnover up to Rs 400 crore. Currently, this rate is only applicable to companies having annual turnover up to Rs. 250 crore. This will cover 99.3% of the companies. Now only 0.7% of companies will remain outside this rate.
Initiative for farmers
Government has said that private entrepreneurships will be supported in driving value-addition to farmers’ produce from the field and for those from allied activities. Dairying through cooperatives to be encouraged by creating infrastructure for cattle feed manufacturing, milk procurement, processing and marketing. 10,000 new Farmer Producer Organizations to be formed, to ensure economies of scale for farmers. Government will work with State Governments to allow farmers to benefit from e-NAM. It will initiate Zero Budget Farming in which few states’ farmers are already being trained to be replicated in other states.
NBFCs and CPSEs
Government has envisioned investment of Rs 100 lakh crore in infrastructure intended over the next five years. Reduction in Net Owned Fund requirement from Rs. 5,000 crore to Rs. 1,000 crore has also beeb proposed. The government has also made a target of Rs 1, 05,000 crore of disinvestment receipts set for the FY 2019-20. It will consider going to an appropriate level below 51% in PSUs where the government control is still to be retained, on case to case basis. Present policy of retaining 51% Government stake will be modified to retaining 51% stake inclusive of the stake of Government controlled institutions. Government will offer an investment option in ETFs on the lines of Equity Linked Savings Scheme (ELSS). It will meet public shareholding norms of 25% for all listed PSUs and raise the foreign shareholding limits to maximum permissible sector limits for all PSU companies which are part of Emerging Market Index.
Measures for FDI
Government has said Insurance Intermediaries will get 100% FDI while local sourcing norms will be eased for FDI in Single Brand Retail sector. It has proposed to increase the Statutory limit for FPI investment in a company from 24% to sectoral foreign investment limit. FPIs will be permitted to subscribe to listed debt securities issued by ReITs and InvITs. It has also proposed to NRI-Portfolio Investment Scheme Route to be merged with the Foreign Portfolio Investment Route.
Strengthening Banking & Finance Sectors
The government has taken several reforms measures to strengthen governance in PSBs. It has proposed to allocate Rs 70,000 crore for Public Sector Banks (PSB) recapitalisation. PSBs will leverage technology, offering online personal loans and doorstep banking, and enabling customers of one PSBs to access services across all PSBs. Steps will be initiated to empower accoun tholders to have control over deposit of cash by others in their accounts.
The Modi government reduced the rate of ESI contribution from both employers and employees. While the employers’ contribution has been reduced from 4.75% to 3.25%, employees’ contribution has been reduced from 1.75% to 0.75%, benefitting 3.6 crore employees and 12.85 lakh employers.
Steps taken to reduce financial frauds
The Modi government approved the Banning of Unregulated Deposit Schemes Bill, 2019 in the just-concluded session of Parliament. The Bill is aimed at banning the unregulated deposit schemes, other than deposits taken in the ordinary course of business, and to protect the interest of depositors. It is also aimed at tackling the menace of illicit deposit taking activities in the country.
Extension of PM-KISAN Scheme
The Union Cabinet has approved to extend the ambit of the Pradhan Mantri KisanSamman Nidhi (PM-KISAN). The revised Scheme is expected to cover around 2 crore more farmers, increasing the coverage of PM-KISAN to around 14.5 crore beneficiaries, with an estimated expenditure by Central Government of Rs. 87,217.50 crores for year 2019-20. The key element of PM-KISAN is income support of Rs 6000 to the small and marginal landholder farmer families with cultivable land holding upto 2 hectare across the country. The amount is being released in three 4-monthly instalments of Rs 2000 each over the year, to be credited into the bank accounts of the beneficiaries held in destination banks through Direct Benefit Transfer mode.
Pension coverage for retail traders and shop keepers
The Cabinet has cleared pension scheme for traders. Under this scheme all shopkeepers, retail traders and self-employed persons are assured a minimum monthly pension of Rs 3,000 month after attaining the age of 60 years. All small shopkeepers and self-employed persons as well as the retail traders with GST turnover below Rs 1.5 crore and age between 18-40 years, can enrol for this scheme. The scheme would benefit more than 3 crore small shopkeepers and traders.