In view of the spread of COVID-19 in India and the continued nationwide lockdown from 25th March 2020 to 3rd May 2020 and further extension, if any, leading to effect on the businesses and the economic performance of the country as a whole and in order to address these adverse times, , the Government of India has been preparing strategies and action plans not only for business continuity and sectoral revival but also to improve Ease of Doing Business in the country by releasing notifications/amendments/circulars highlighting measures to improve the business environment in India. Here is a categorised summary of some of the special measures by Central government, Reserve Bank of India, Securities & Exchange Board of India (SEBI), Insurance Regulatory and Development Authority (IRDAI) and the sectoral ministries to boost businesses in India.
General / sectoral relief measures with an economic impact
Ø Invest India Business Immunity Platform launched to helping businesses withstand COVID-19
Ø Relaxations provided on compliances to be met by units / developers / co‐developers of SEZs
Ø More than 280 units in SEZs, manufacturing essential items like pharmaceuticals and hospital devices, are operational
Ø DPIIT sets up a Control Room to monitor the status of transportation and delivery of goods, manufacturing, and delivery of essential commodities
Ø Petroleum & Explosives Safety Organization takes various measures to address the problems faced by Petroleum, Explosives, Oxygen and Industrial Gas Industries
Ø MNRE announced time extension in scheduled commissioning date of renewable energy projects due to disruption in supply chain
Ø MNRE issues instructions regarding invoicing of renewable energy supplies, invoices over email can be accepted instead of hard copies
Ø Clarification regarding moratorium to discoms for payments, must run status to RE generating stations, regular payment to RE generating stations required
Ø Clarification by MNRE on Must Run status of Renewable Energy Stations during lockdown, no curtailment except for grid safety reasons allowed
Ø Extension of six months in effective dates under Approved List of Models and Manufacturers (ALMM) Order concerning solar PV modules/cells
Ø Effective date for implementation of Approved Lists of Models and Manufacturers of Solar PV Modules and Solar PV Cells extended by six months
Ø Extension for RE Projects for a period of 30 days beyond lockdown
Ø Power minister approves major relief measures for power sector. (1) Union power ministry to ensure 24×7 electricity supply during lockdown (2) Payment security to be reduced by 50% (3) 3 months moratorium on Discoms to make payment to Gencos and transmission licensees
Ø Clarification regarding payment of dues by discoms, obligation to pay within specified period (45 days or otherwise in PPA) remains, late charges at reduced rate applicable
Ø Ministry of Coal appoints nodal officers for responding to queries raised by various consumers/stakeholders and outside agencies during the lockdown
Ø Coal India Limited to extend Usance Letter of Credit facility to Power and Non-Power consumers for payment of coal instead of cash advance for the Fuel Supply Agreements
Ø Extension of validity of prior issued environmental clearances for all projects and activities which are expiring between March 15, 2020 and April 30, 2020, till June 30, 2020 to ensure uninterrupted operations
Ø All projects or activities related to bulk drugs and intermediates manufactured for addressing ailments such as COVID-19 and those with similar symptoms have been categorised as ‘B2’ for a period up to the 30th September 2020. This means will not be required to submit an Environment Impact Assessment (EIA) report.
Ø Department of Science and Technology sets up task force for mapping of technologies by Start Ups on COVID-19
Ø Ministry of Food Processing Industries(MoFPI) sets up a grievance cell for the food and related industry to ensure hassle-free operations and uninterrupted supply of essentials
Ø Relaxation of six weeks to telecom service providers for filing monthly and quarterly reports with TRAI due in April 2020
Ø Extension of Airworthiness Review Certificate (ARC) during the lockdown phase of COVID19
Ø Extension of validity of certain approvals and licenses/authorisations issued under the Aircraft Rules, 1937 related to COVID 19 Lockdown
Ø Notification under the Ordinance to extend time limits for various GST compliances to June 30, with effect from March 20
Ø Textiles Ministry extends limit for HDPE/PP bags from 1.80 lakh bales to 2.62 lakh to tide over crisis of packaging of foodgrains due to closure of jute mills during lock down, writes to Governments of all jute growing States to allow movement, sale and supply of jute seeds, fertilizers and other farming aids. Ministry committed to protect interest of jute farmers and workers
Ø Extension of time period for filing ESIC contributions by employers in view of COVID-19 pandemic
Ø Exemptions granted to businesses for various purposes including testing and approval of tractors, tillers, harvesters, and other machinery (till December); expiring licences of seed dealers to be valid till September
Trade & Commerce in India get a boost
Ø Helpdesk operationalized by DGFT for COVID-19 related Export or Import issue
Ø Advisory on non-charging of container detention charges on import and export shipments
Ø Temporary relaxation in processing of documents pertaining to Foreign Portfolio Investors due to COVID-19
Ø Foreign Trade Policy 2015-2020 extended for one year, Other immediate relief measures also announced
Ø Validity of Registration cum Membership Certificate of members of Export Promotion Councils expiring in Mar 2020 to be extended up to Sep 2020
Ø Scanned copies of pre-registration and other documents for registration under European Union Generalised System of Preferences to be accepted
Ø Deadline for certain requests such as one-time condonation under the Export Promotion Capital Goods (EPCG) scheme extended till March 31, 2021
Ø Exemption granted from Basic Customs Duty and Health Cess (till September 2020) on import of ventilators, masks, PPEs, test kits, and inputs used to manufacture these
Ø Department of Commerce has Provided a number of Relaxations / Extensions of various Compliance Deadlines etc. to address Corona Pandemic Related Hardships of Exporters
Ø Relaxation in provision for submission of physical copy of application for availing Transport and Market Assistance for specified agricultural products
Ø All-India Agri Transport Call Centre set up to facilitate inter-state movement of perishables (crops and inputs) during lockdown
Ø FDI Policy amended to curb opportunistic acquisition or takeover of Indian companies, restrictions on entities of countries sharing border with India
Ø Extension in deadline for application for initiating an Anti-dumping Sunset Review investigation
Managing Corporate Affairs efficiently
Ø Certain relaxations provided to companies and Limited Liability Partnerships (LLPs) from statutory requirements under Companies Act, 2013 and LLP Act, 2008.
Ø Companies Fresh Start Scheme notified for permitting delayed filings under the Companies Act, 2013
Ø COVID-19 related Frequently Asked Questions (FAQs) on Corporate Social Responsibility (CSR)
Ø Clarifications on passing ordinary and special resolutions by companies under the Companies Act, 2013 in view of COVID-19
Ø Clarifications for holding AGMs for companies in view of COVID-19
Providing stimulus to the BFSI sector in India
Ø Guidelines to be followed by insurers for handling of insurance claims reported under Coronavirus
Ø Operational and business continuity measures to be taken by banks and other financial institutions such as: (i) taking stock of critical processes, and (ii) encouraging customers to take up digital banking facilities.
Ø SEBI relaxes compliance of certain obligations and disclosure requirements in view of COVID pandemic, such as: (i) filing of corporate governance report, (ii) compliance certificate on share transfer facility
Ø Relief measures announced by Finance Minister regarding: (i) Income tax filing, (ii) GST filing, (iii) Corporate affairs (iv) GST, (v) Customs & Central Excise (vi) Insolvency & Bankruptcy Code (IBC) (vii) Fisheries, (viii) Banking Sector and (ix) Commerce.
Ø SEBI notified capital and debt market services to be exempted from the nationwide lockdown. These include registered stock exchanges, clearing corporations and mutual funds, among others.
Ø Relaxation from Substantial Acquisition of Shares and Takeovers Regulations. These regulations require shareholders to compile, collate, and disseminate information of their consolidated shareholding as on March 31, 2020, to the company and the stock exchanges.
Ø Instructions to banks/NBFCs by RBI on measures for easing the burden of debt servicing, three month moratorium on payment of instalments etc.
Ø RBI released a statement on development and regulatory policies to address the stress in financial conditions caused by COVID19. These include expanding liquidity in the system and relaxing repayment pressures.
Ø RBI reduced the policy repo rate from 5.15% to 4.4% and reverse repo rate from 4.9% to 4.0% in March 2020, due to the negative effects of the coronavirus
Ø Steps to be taken by insurers amidst COVID-19 pandemic for smooth functioning of insurance industry. These include: (i) displaying COVID-19 claims related FAQs on their website, (ii) putting in place a Business Continuity Plan.
Ø Relaxation in certain compliance requirements for FPIs due to COVID-19
Ø RBI decides it is not necessary to implement countercyclical capital buffer (CCyB) for a period of one year. CCyB framework aims banking system to build up a buffer of capital in good times which may be used to maintain flow of credit to the real sector in difficult times.
Ø RBI provides extension in time period for realisation of export proceeds from nine months to 15 months for exports upto July 31,2020, Review of Limits of Way and Means Advances of States/UTs and Implementation of countercyclical capital buffer
Ø IRDAI permits insurers to grant a moratorium of three months towards payment of instalments falling due between 1 March 2020 and 31 May 2020
Ø IRDAI has released guidelines for prudent management of financial resources of insurers in the context of Covid-19 pandemic. This includes critically examining their capital availability and solvency margin as required, and devise strategies to ensure that they have adequate capital
Ø SEBI provides relaxation in certain regulatory requirements, such as client funding reporting and risk based supervision reporting, for stock exchanges and clearing corporations
Ø SEBI provides relaxation in time period for certain activities carried out by depository participants, such as processing of demat requests
Ø In view of COVID-19, the period from March 1, 2020 to May 31, 2020 will be excluded from the 30 day review period post which the lenders are required to implement a 180 day resolution plan for resolution of stressed assets
Ø RBI has revised the liquidity coverage ratio (LCR) in form of high quality liquid assets to be maintained with the banks. Banks will be required to maintain 80% LCR till Sept'20, 90% from Oct'20 to March'21 and 100% LCR from 1 April 2021 onwards.
Ø RBI has mandated that banks should not make any further dividend payouts from the profits of FY 2020 till further instructions. This is done to ensure banks conserve capital to retain their capacity to support the economy and absorb losses, in view of COVID-19.
Ø RBI announces several additional measures to combat the macroeconomic conditions due to COVID-19. These include: (i) reduction in reverse repo rate from 4% to 3.75%, (ii) refinancing of financial institutions NABARD, SIDBI and NHB for a total amount of Rs 50,000 crore.
Ø Reserve Bank Announces Targeted Long-Term Repo Operations 2.0 with a 25 basis point reverse repo cut taking it to 3.75 per cent from 4 per cent earlier. A TLTRO 2.0 of Rs 50,000 crore specifically targeted at NBFCs has been announced.