The latest measures announced by the Finance Minister in the field of real estate and exports would help provide stimulus to the slowing economy, industry FICCI President Sandip Somany said on Sunday.
The industry body welcomed the government's move a day after Finance Minister Nirmala Sitharaman announced steps to help the nearly stalled real estate sector and increase India's exports. Sitharaman on Saturday announced a fresh set of measures worth around Rs 60,000 crore to boost exports and the housing sector.
"These new measures will provide a much-needed stimulus to boost the Indian economy that is now facing the slowdown," Somany said.
In a statement, Somany also said that the relaxation of external commercial borrowing (ECB) guidelines for affordable housing and reduction in interest on 'Housing Building Allowance' in line with the 10-year Government-Securities yield is a major step towards achieving the target of the 'Pradhan Mantri Awas Yojana' (PMAY).
"Provision of Rs 10,000 crore to provide last-mile funding for completion of the ongoing housing projects (which are not NPAs or facing bankruptcy proceedings under NCLT) is certainly a major push to resolve the problem of stalled projects in the country," he said.
Sitharaman on Saturday announced that there would be a special window for affordable and middle-income housing to provide last-mile funding for housing projects which are not under the insolvency process in the National Company Law Tribunal (NCLT), and not declared non-performing assets (NPAs or bad loans) to complete unfinished projects.
For this, a fund of Rs 10,000 crore would be contributed by the government and "roughly the same size by outside investors", the minister announced.
The key measures for exports include extending the scheme of reimbursement of taxes and duties for export promotion, fully automated electronic refund for input tax credits (ITC) in GST, revised priority sector lending norms for exports and expanding the scope of Export Credit Insurance Scheme (ECIS).
Somany also expressed confidence that the initiatives of export-related incentives, finance, credit and facilitation will help in achieving a turnaround in India's exports which have declined by 6 per cent in August.
"The new scheme for Remission of Duties or Taxes on Export Product (RoDTEP) that will be effective from January 1, 2020, will go a long way in addressing the problem of non-compliance of our export promotion scheme," the FICCI President said.
"Fully automated electronic refund module for Input Tax Credits (ITC) in GST will speed up the ITC refund and ease the problem of working capital for exporters. Expanding the scope of Export Credit Insurance Scheme, moderation in premium incidence for MSME, and revised Priority Sector Lending (PSL) norms for export credit are also encouraging features of the new package," he said.
Additional funding of Rs 36,000 crore to Rs 68,000 crore as export credit under the priority sector is also encouraging in the backdrop of recent decline in export credits, he added.
Somany also praised the idea of annual mega shopping festivals for promoting exports of gems and jewellery, handicrafts, textiles, leather, yoga and tourism.
"In view of the critical importance of technical standards, the plan for expanding and developing affordable testing and certification facilities under PPP (Public Private Partnership) mode will equip our engineering goods exporters to align with the globally accepted tests and certification processes," he added.
He also welcomed the measures related to Free Trade Agreements (FTAs), in particular setting up of 'FTA Ultilisation Mission' as well as setting the goals for FTA ultilisation by Indian business."This is extremely crucial because so far Indian exporters have not utilised the existing FTAs in a major way," he said.