Lok Sabha Question No. 476 (UNSTARRED), answered on 2020-09-16
Subject: Slowdown in Growth
Ministry: COMMERCE AND INDUSTRY
Asked by: Y. S. Avinash Reddy, Raghu Ramakrishna Raju Kanumuru

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 476. TO BE ANSWERED ON WEDNESDAY, THE 16 TH  SEPTEMBER, 2020.

## SLOWDOWN IN GROWTH

## 476.   SHRI Y.S. AVINASH REDDY: SHRI KANUMURU RAGHU RAMA KRISHNA RAJU:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

वाणिज्य एवं उद्योग मंत्री

- (a) whether  any  measures  have  been  taken  by  the  Government  to  instil confidence in the industries considering the slow pace of economic growth in the country;
- (b) if so, the details thereof and if not, the reasons therefor;
- (c) whether the  Government  has studied the impact of recent economic slowdown that has been reported and prevalent in other parts of the world; and
- (d) if so, the details thereof?

## ANSWER वाणिज्य  एवं उद्योग मंत्री (श्री पीयूष गोयल) THE MINISTER OF COMMERCE & INDUSTRY (SHRI  PIYUSH GOYAL)

Promotion  of  industries  is  a  continuous  and  ongoing  effort  of  the Government. Government has taken a number of steps, in addition to the ongoing schemes, to boost the growth of industries. The measures

- (a) & (b): taken in a few important areas are highlighted below:
- 1) Atmanirbhar  Package to boost Industrial growth has been announced by the Government for Rs. 20.97 lakh crore with bold reforms  in  a  number  of  sectors.    The  Emergency  Credit  Line Guarantee Scheme (ECLGS), having provision of Rs 3 lakh crores, is 100% credit guarantee and Collateral Free Automatic Loans for MSMEs. Financial support has been given to the stressed MSMEs with infusion of Rs.20,000 crore equity support through Subordinate Debt.   Fund of Funds created to infuse equity worth Rs.50,000 crore in the MSME Sector by setting up Rs.10,000 crore Corpus Fund. Also, Government is ensuring timely payment to the

MSMEs by instructing all Government of India and CPSEs to clear all  receivables  of  MSMEs  within  45  days.  Procurement  from domestic  companies  is  being  encouraged  by  disallowing  global tender in government procurement tenders upto Rs 200 crores.

- 2) Higher FDI has been allowed through automatic route in a number of sectors by streamlining and liberalising several sectors. Empowered Group of Secretaries (EGoS) & Project Development Cells  (PDCs)  have  been  set  up  in  order  to  provide  support  and facilitation to investors for investing in India and to boost growth in key sectors of the economy.
- 3)  A centralized Investment Clearance Cell is being created, which would provide end-to-end facilitation support, including preinvestment advisory, information related to land banks and facilitating clearances at Central and State level.
- 4)  The Insolvency  and  Bankruptcy  Code has  been  enacted  in December  2016  to  address India's chronic problem of  nonperforming assets (NPA).
- 5) Corporate  Taxes have  been  reduced  to  encourage  domestic manufacturing.    With  effect  from  FY  2019-20,  corporate  tax  for domestic companies has been reduced to 22 per cent and for new manufacturing companies, incorporated on or after  01.10.2019, to 15 per cent.
- 6)  In order to realize the economies of scale, incentives are extended to  units  as  per  annual  increases  in  their  production/sale  under Production  Linked  Incentive  (PLI)  scheme .  PLI  scheme  has been announced for large scale electronics manufacturing (Rs.40,955  crore),  medical  devices  (Rs.3,420  crore)  and  KSMs/ Drug Intermediates and APIs  (Rs. 6,940 crore).
- 7)  In order to promote domestic manufacturing of sectors facing high imports or cheaper imports, incentives are provided through rationalization of Basic Customs Duty on identified products under Phased Manufacturing Programme (PMP) .  Presently, PMP is in operation for Cellular Mobile Handsets and e-vehicles.
- 8)  The Government has launched the National Infrastructure Pipeline (NIP) in December, 2019 to provide world-class infrastructure across the country and improve the quality of life for all citizens. As per Final Report submitted by the NIP Task Force, the  projected  total  expenditure  on  infrastructure  would  be  of  Rs. 111 lakh crore during the period FY 2020-25.

India  has  responded  proactively  to  the  Covid-19  challenge.    Indian manufacturers  have  enhanced  production  of  PPE,  N-95/N-99  masks, HCQ  medicine  and  oxygen  cylinders  to  meet  the  domestic/external requirements.    The  Indian  economy  is  known  for  its  resilience  and  is expected  to  gradually  return  to  its  high  growth  performance  in  the coming months.

- (c) & (d): As  per IMF's  World  Economic  Outlook  (WEO) (June  2020),  in  the year  2020,  global  economic  growth  is  projected  to  contract  by  4.9 percent. The COVID-19 pandemic has had a bigger negative impact on activity  in  the  first  half  of  2020.  Most  economies  in  the  group  are forecasted  to  contract  this  year,  including  the  United  States  (-  8.0 percent),  Japan  (-5.8  percent),  the  United  Kingdom  (-10.2  percent), Germany (-7.8 percent), France (-12.5 percent), Italy (-12.8 percent), and Spain (-12.8 percent).

As per the Global Economic Prospects Report (June 2020) of the World  Bank ,  global  GDP  is  expected  to  contract  by  5.2  percent  in 2020, the deepest global recession in eight decades, despite unprecedented policy support.

******