Govt takes slew of measures for revival of business in J&K

As Jammu and Kashmir is facing economic meltdown, the government has issued slew of instructions to revive the business in the Union Territory including fixing timeframe for implementation of recently announced Rs 1350 crore revival package by Lieutenant Governor.

In this regard the government has issued an order to all the administrative secretaries to take appropriate action and accord time-bound necessary sanctions.

The revival package was announced amid businesses complaining of slump post August 2019 which was followed by COVID lockdown since March 2020. According to preliminary estimates of a traders’ body, Kashmir’s economy has incurred Rs 40,000 crore economic losses since August 2019 when the special status of J&K was abrogated.

According to a communiqué issued by the finance department, the government has directed banks and the finance department to complete all formalities within one month for interest subvention of 5% in case of all borrowers excluding borrowers under KCC, ACC, Loan against deposits, Loans under personal segments, NBFCs for a period of 06 months w.e.f. 1st April, 2020.

The Benefit shall be available to those borrowers whose accounts were standard on 31-07-2019 or 31-03-2020 whichever is applicable.

As per the order, Power Development Department and Jal Shakti department have been asked to complete within one month formalities for 50 % waiver of the fixed charges of electricity in respect of the Industries and Commercial Establishments for a period of 1 year from January 2020 to December, 2020.

The administrative secretary of Transport department has been directed to complete the formalities for providing 50% subsidy or Rs 5.00 lakh whichever is lower to the transporters for replacement of old buses.

In cases where the ownership has been transferred without affecting necessary changes with the transport department, the subsidy shall be paid to the actual operator after inviting due objections in a transparent manner within a period of three months.

Similarly, assistance shall be provided by the government with respect to insurance premium subject to maximum of Rs 5000 per vehicle for buses/mini buses, Rs 3000 for taxies/sumos and Rs 2000 for three wheelers by the transport department within two months.

The government has made administrative measures too to help the businesses to overcome the financial problems and slump in economic activities due to continuous lockdowns.

Delay in the payments to industries and suppliers shall be monitored by a committee having Administrative Secretaries of RDD, I&C Department, PDD & PW (R&B) Department as members under the overall supervision of Financial Commissioner, Finance.

“Functional NPAs/ all standard accounts shall be restructured in a time bound manner within laid down norms,” it reads.

According to government order, the date of filing of GST reimbursement claims up to the period 31.12.2019 shall be extended to 31st December, 2020 provided that the units have filed up to date returns.

“The bank will streamline powers to sanction loans by branches within one week,” it states.

“The repayment schedule/residual tenor of term loan facilities will be extended across the board by 6 months after the end of moratorium period. RBI has also permitted Lending institutions, at their discretion, to convert the accumulated interest for the deferment period (March 01, 2020 up to August 31, 2020) into a funded interest term loan (FITL) which shall be repayable not later than March 31, 2021. Finance Department/ J&K Bank (Request received to be disposed of within one month),” the order reads.

The banks have extended up to 20% additional funding to all eligible borrowers for revival of their stalled business activities under GECL scheme and business support scheme.