Context: Finance Minister Nirmala Sitharaman on Thursday announced stimulus measures to aid job creation, and boost the key real estate and infrastructure sectors, under the government's Atmanirbhar Bharat 3.0 package, aimed at rescuing the economy out of a historic contraction. "A number of indicators are showing that recovery is clearly happening in the economy... The strong recovery is based on the unrelenting reforms that the government has brought in a systematic manner,"  the Finance Minister said in a media briefing. Asserting that the latest set of measures take the overall monetary and fiscal support for the economy to Rs 29.88 lakh crore, the finance minister said it is equivalent to 15 per cent of the country's GDP.  The announcements come at a time when economists have called for the need for further impetus to aid a revival in an economy battered by the world's biggest lockdown to curb the spread of COVID-19. 

Key Stimulas under Atmanirbhar Bharat 3.0
(1) Atmanirbhar Bharat Rozgar Yojana

• A new scheme to incentivize job creation during COVID-19 recovery has been launched.
• The Yojana will benefit if EPFO-registered establishments take in new employees without EPFO registration or those who lost jobs earlier.

Key Beneficiaries
Any new employee joining employment in EPFO registered establishments on monthly wages less than Rs.15,000

• EPF members drawing monthly wage of less than Rs.15,000 who made exit from employment during COVID Pandemic .
• The employee should have been in served from 01.03.2020 to 30.09.2020 and is employed on or after 01.10.2020.
• Central Govt.will provide subsidy for two years in respect of new eligible employees engaged on or after 01.10.2020. 

The subsidies will be at following scale:

• ESTABLISHMENTS EMPLOYING UP TO 1000 EMPLOYEES: Employee’s contributions (12% of Wages) & Employer’s contributions (12% of wages) totalling 24% of wages
• ESTABLISHMENTS EMPLOYING MORE THAN 1000 EMPLOYEES: Only Employee’s EPF contributions (12% of EPF wages).

(2) Emergency Credit Line Guarantee Scheme (ECLGS) 

• For MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), has been extended till March 31, 2021.
• A Credit guarantee support scheme ECLGS 2.0 is being launched for Healthcare sector
• 26 stressed sectors with credit outstanding of above Rs. 50 crore and up to Rs  500 Crore as on 29.2.2020 stressed due to COVID-19, among other criteria.
• Entities will get additional credit up to 20% of outstanding credit with a tenor of five years, including 1 year moratorium on principal repayment.
• This scheme will be available till 31.3.2021.

(3) Production-linked incentives for 10 Champion Sectors 

• This will give a big boost to economy, investment, exports and job creation.
• A total amount of nearly 1.5 Lakh Crore has been earmarked across sectors, for next five years.

Check: https://abhipedia.abhimanu.com/Article/IAS/MjM2Njkx/Extension-of-PLI-Scheme-for-Ten-More-Sectors-Economic-Affairs-IAS
4) PM Awaas Yojana (PMAY)-Urban

• A sum of Rs 18000 cr is being provided for PMAY– Urban over and above Rs. 8000 Crore already allocated this year. 
• This will help ground 12 Lakh houses and complete 18 Lakh houses , create additional 78 Lakh jobs.
• This will improve production and sale of steel and cement, resulting in multiplier effect on economy.

(5) Support for Construction & Infrastructure

• Relaxation of earnest deposit money & performance security on government tenders is the central idea.
• To provide ease of doing business and relief to contractors , performance security on contracts has been reduced from 5-10% to 3%.
•  It will also extend to ongoing contracts and Public Sector Enterprises.
• EMD for tenders will be replaced by Bid Security Declaration.
• The relaxations in the General Financial Rules will be in force till December 31, 2021.

(6) Income Tax relief for Developers & Home Buyers 

• Differential between circle rate and agreement value in real estate income tax under Section 43 CA of IT Act has been increased from 10% to 20%.
• This is for primary sale of residential units up to Rs 2 Crore (from date of announcement of this scheme, till June 30 2021).
• Consequential Relief up to 20% shall also be allowed to buyers of these units under section 56(2)(x) of IT Act for the said period.
• The Income Tax relief provides incentive to middle class to buy homes.

(7) Equity infusion in NIIF Debt Platform

• Government will make Rs 6,000 Crore equity investment in debt platform of National Investment and Infrastructure Fund (NIIF).
• It will help NIIF provide a debt of Rs 1.1 Lakh Crore for infrastructure projects by 2025.

(8) Support for Agriculture

• As fertilizer consumption is going up significantly, Rs 65,000 Crore is being provided to ensure increased supply of fertilizers to farmers .
• This will enable timely availability of fertilisers in the upcoming crop season.

(9) Enhanced outlays under PM Garib Kalyan Rozgar Yojana

• An additional outlay of Rs. 10,000 crores will be provided for PM Garib Kalyan Rozgar Yojana in the current fiscal year to boost rural employment. 
• It is to be noted that the Scheme is already in progress in 116 Indian districts and Rs. 37,543 has already spent to date on PM Garib Kalyan Rozgar Yojana. 

(10) Boost for Project Exports 

• Rs 3,000 Crore boost is being provided to EXIM Bank .
• This is for promoting project exports under Indian Development and Economic Assistance Scheme (IDEAS Scheme).
• This will help EXIM Bank facilitate Lines of Credit development assistance activities and promote exports from India.

(11) Capital and Industrial Stimulus

• An additional budget outlay of Rs. 10,200 crores will be provided towards Capital and Industrial expenditure. To enhance: Domestic defence equipment; Industrial infrastructure and Green energy.

(12) Research and Development for COVID-19 Vaccine Development

• Rs 900 Crore is being provided to Department of Biotechnology.
• This is for Research and Development of Indian COVID Vaccine.

Road Ahead

• The stimulas package couldn't have come at a better time especially when we know what has happened in the US, we know in which way Europe is going and also it's a festive season. So this is the best time to come out with package like that. Job creation has been an issue and the package tries to address this particular problem as well by ensuring that the stimulas and money goes to labour intensive sector. So that the jobs are created there. Execution is where the challenge is really going to be we need to ensure that we execute all these plan properly so that we get the full benefit out of it. One thing that we need to watch out for going forward is we have to ensure that we don't see any more further waves of Covid-19 and that's where we as a community come in and support the entire ecosystem.