Finance Minister Nirmala Sitharaman stated on September 26th that various ministries had cleared Rs 40,000 crore out of their respective dues out of the Rs 60,000 crore debt, majorly to MSMEs (Micro Small & Medium Enterprises) for the supply of goods and services, and the rest of the amount not locked in litigation too will be paid by the first week of October. It comes within a week of handing out a corporate tax cut of Rs 1.45 lakh crore.
According to a report by DH, the step is expected to improve cash-flow to Micro Small & Medium Enterprises, the major employers in the nation, who have been complaining about the lack of credit growth hindering their business. Nitin Gadkari, Road & Transport Minister, lately had a meeting with their representatives, post which he impressed upon the FM to look into their delayed payments.
After meeting the top officials of 21 major infrastructure ministries, Sitharaman said,
“My intention is to have government departments clear all pending payments whoever it belongs to.”
The FM also said that the ministries and departments had been asked to provide their tabulated capex plans for the next four quarters as the center looks to push economic growth and come out of the lagging economy.
Reports say that the Expenditure Secretory G C Murmu, who was also present at the press conference, stated that most of the infrastructure ministries have reached 50% of their capital-expenditure target for the current fiscal year.
As per Budget 2019-20, the total expenditure projection for the state government this fiscal is Rs 27.86 lakh crore. Of this, the cap-ex is budgeted at Rs 3.38 lakh crore.
Sitharaman aforementioned that the government’s cap-ex was on track and the Budget estimates will likely be met. She further added that the consumption was on the rise and credit offtake was growing, which overall should result in “buoyancy” in the economy.
The minister replied to a query on fiscal discipline with a rebate in corporate tax and expenditure that the government will reconcile the budgetary deficit numbers later.