Cabinet meeting today: Boost to MSMEs, help for farmers, street vendors in major Cabinet decisions | India News – Times of India

NEW DELHI: The Union Cabinet on Monday cleared major decisions to give a boost to the MSME sector and provide support to farmers and street vendors in a meeting chaired by Prime Minister Narendra Modi.
Among the major decisions, the Cabinet has approved Rs 50,000 crore equity infusion for MSMEs to strengthen their growth potential and hiked the minimum support price (MSP) for 14 Kharif crops.
The government said the historic decisions taken during the meeting will have a transformative impact on the lives of India’s hardworking farmers, MSME sector and those working as street vendors.

Here are the key decisions taken during the Cabinet meet:
Boost to MSMEs
The Cabinet approved the proposal for provisioning of Rs 20,000 crore as subordinate debt to provide equity support to the stressed MSMEs. The move is likely to benefit 2 lakh stressed MSMEs
It also cleared proposal for equity infusion of Rs 50,000 crore for MSMEs through fund of funds.
The government said it will establish a framework to help MSMEs in managing the debt-equity ratio and in their capacity augmentation. This will also provide an opportunity to get listed in stock exchanges.
The Cabinet also decided to further revise the definition of MSME after demands by the sector. In the package announcement, the definition of micro manufacturing and services unit was increased to Rs 1 crore of investment and Rs 5 crore of turnover. The limit of small unit was increased to Rs 10 crore of investment and Rs 50 crore of turnover.

Similarly, the limit of a medium unit was increased to Rs 20 crore of investment and Rs 100 crore of turnover.
This revision was done after 14 years since the MSME Development Act came into existence in 2006. After the package announcement on May 13, there were several representations saying that the announced revision is still not in tune with market and pricing conditions and it should be further revised upwards.
Keeping in mind these representations, the government decided to further increase the limit for medium manufacturing and service units. The definition has been revised to Rs 50 crore of investment and Rs 250 crore of turnover.
It has also been decided that the turnover with respect to exports will not be counted in the limits of turnover for any category of MSME units whether micro, small or medium.
Support for street vendors
The ministry of housing and urban affairs launched a special micro-credit facility scheme – PM SVANidhi – PM Street Vendor’s AtmaNirbharNidhi, to provide affordable loans to street vendors. The government said the scheme will go a long way in enabling these vendors to resume work and earn livelihoods amid the pandemic.
Over 50 lakh people, including vendors, hawkers, thelewalas, rehriwala, theli-phadwala, etc in different areas/contexts are likely to benefit from this scheme, it said.

The goods supplied by them range from vegetables, fruits, ready-to-eat street foods, tea, pakodas, breads, eggs, textiles, apparel, footwear, artisan products, books/ stationaries etc. The services include barber shops, cobblers, pan shops, laundry services etc.
The government said the scheme is special as it is the first time that street vendors have become beneficiaries of an urban livelihood programme.
A digital platform with web portal/mobile app is also being developed to administer the scheme with end-to-end solution.
The IT platform will also help in integrating the vendors into the formal financial system. This platform will integrate the web portal/ mobile app with UdyamiMitra portal of SIDBI for credit management and PAiSA portal of MoHUA to administer interest subsidy automatically.
The scheme incentivises digital transactions by the street vendors through monthly cashback.
Assistance to farmers
The government hiked the minimum support price (MSP) of paddy marginally by Rs 53 per quintal to Rs 1,868 per quintal for the 2020-21 crop year, while the rates for oilseeds, pulses and cereals were also raised.
The decision will help farmers take a call on which kharif (summer) crop to grow as sowing picks up with the arrival of southwest monsoon.

The Met Department has projected normal monsoon during the June-September period.
“Based on the recommendation of the Commission for Agricultural Costs and Prices (CACP), the cabinet has approved MSP of 14 crops. Paddy (common) MSP has been increased to Rs 1,868 per quintal for this year,” Tomar said.
He said the increase in support price of paddy will ensure 50 per cent return over the cost to the farmers, he said.
The MSP of Grade A variety of Paddy has been increased to Rs 1,888 per quintal for 2020-21 crop year from 1,835 per quintal last year.
The government has also decided to extend repayment date up to August 31, 2020 for all short-term loans up to Rs 3 lakh advanced for agriculture and allied activities by banks. Farmers will also get benefit of interest subvention and prompt repayment incentive.
The agricultural short-term loan due between March 1, 2020 and August 31, 2020, will continue to get benefit of 2% Interest Subvention to banks and 3% Prompt Repayment Incentive to farmers.