On Friday, Finance Minister Nirmala Sitharaman while addressing an event of FICCI said, “Banks cannot refuse credit to MSMEs covered under Emergency Credit Facility.” And if the banks are refusing these requests, it must get reported that she will look into it.

Up to July 23rd, 2020 the total amount sanctioned under the 100% Emergency Credit Line Guarantee Scheme by Private Banks and Public Sector Banks (PSUs) stands at Rs.1,30,491.79 Crores, out of which Rs.82,065.01 Crores is already distributed. The Government has announced Rs.3 Lakh Crore Collateral-Free Automatic Loans for MSMEs and businesses under the Aatmanirbhar Bharat Package.

She also said that every step which is being announced and taken to deal with the current situation is done after exhaustive consultation with the stakeholders and industry experts. The Finance Minister assured that the Finance Ministry is working with the Reserve Bank Of India on the extension of loan moratorium or a restructuring scheme for the hospitality industry.

She stated, “I fully understand the requirements of the hospitality sector on extension of the moratorium or restructuring. We are working with RBI on this.”

The Reserve Bank Of India had announced a three-month loan moratorium in March, which was later extended by another three months till August 31, so it can help the borrowers in this Coronavirus period with their liquidity crunch problems. Also, the borrowers who have opted for loan moratorium were able to defer the interest payments and principal amount of loan in this period.

Finance minister said, “Reciprocity is a very critical point in our trade negotiations” which meant that India is asking for the reciprocal arrangements from the countries with which it has opened up its markets as international trade is facing headwinds from the global lockdown and other restrictions.

With Warm Regards,

CL Bureau.

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