Housing projects and exports get Nirmala's attention
The government on Saturday announced a Rs 10,000-crore special window to provide last-mile funding for completion of ongoing housing projects which are not non-performing assets or facing bankruptcy proceedings.
Finance minister Nirmala Sitharaman said the government will contribute Rs 10,000 crore and roughly the same amount is expected from outside investors.
This window will help in completing affordable, middle-income housing projects. The fund will be managed by professionals, the minister added.
Sitharaman also said the interest rate on house building advance will be lowered. 'Government servants contribute to a major component of demand for houses. This will encourage more government servants to buy new houses,' she said.
External commercial borrowing (ECB) guidelines will also be relaxed to help housing developers obtain overseas funds. The ECB guidelines will be relaxed to facilitate financing of homebuyers who are eligible under the Pradhan Mantri Awas Yojana in consultation with the central bank.
Sitharaman also announced revised priority sector lending norms for exporters which will release an additional funding of Rs 36,000 crore to Rs 68,000 crore to them.
Priority sector lending norms for export credit have been examined and enabling guidelines are under consideration by the RBI, she said. 'This will release an additional Rs 36,000 crore to Rs 68,000 crore as export credit under the priority sector,' she said.
Also, the Export Credit Guarantee Corporation will expand the scope of an export credit insurance scheme.
The minister said the initiative is expected to cost Rs 1,700 crore annually and will enable reduction in overall cost of export credit, including interest rates, especially to MSMEs.
She also announced that a Free Trade Agreement (FTA) Utilisation Mission would be set to help exporters optimally utilise the concessional tariffs under trade pacts which India has signed with several countries.
Annual shopping festivals will be organised in the country at four places focusing on sectors like handicrafts, yoga, tourism, textiles and leather.
Sitharaman also announced a new scheme -- the Remission of Duties or Taxes on Export Product -- to incentivise exporters at an estimated cost of Rs 50,000 crore to the exchequer.
The announcement comes in the backdrop of India's merchandise exports declining by 6.05 per cent to $26.13 billion in August compared to the year-ago month.
The minister also said there will be a fully automated electronic refund route for input tax credits in GST. This will be implemented by the month-end.
The move, she added, is aimed at quick and automated refunds of tax credits.
She said the Remission of Duties or Taxes on Export Product will replace the existing incentive schemes and 'will more than adequately incentivise exporters than the existing schemes put together'.
The minister said the revenue foregone towards the scheme is projected at Rs 50,000 crore.
Written with PTI reports