Annual Report

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Date : Aug 25, 2020
Annex II: Chronology of Major Policy Announcements to Mitigate the Impact of COVID-19
Date of Announcement Policy Initiative
A. Government of India (GoI)
February 25, 2020 Export prohibition of specified personal protective equipment (PPE), including clothing and masks (NBR gloves and medical goggles), while exempting some items such as surgical blades, non-woven disposable shoe covers, breathing appliances used by airmen, firemen, divers and mountaineers, gas masks, tarpaulin, PVC conveyer belt and biopsy punch.
March 3, 2020 Export restriction of certain active pharmaceutical ingredients (APIs) and formulations made from them such as paracetamol, acyclovir, vitamins B1, B6 and B12.
March 14, 2020 Norms for assistance from State Disaster Response Fund (SDRF) were issued.
March 19, 2020 Export prohibition of surgical masks/disposal masks (2/3 ply masks), ventilators (including any artificial respiratory apparatus or oxygen therapy or any other breathing appliances/devices), textile raw materials for masks and coveralls.
March 24, 2020 • Relaxations in statutory and compliance matters were made such as extension of deadline for filing income tax/GST returns, payments under Vivad se Vishwas scheme and various corporate matters.
• Bank charges for digital trade transactions for trade finance consumers were reduced.
• Threshold of default under Section 4 of the Insolvency and Bankruptcy Code (IBC) was raised from ₹1 lakh to ₹1 crore to prevent triggering of insolvency proceedings against micro, small and medium enterprises (MSMEs) which are going through a phase of financial distress.
• Waiver of charges for cash withdrawal from ATMs using debit cards for three months.
• Export prohibition of sanitisers.
March 26, 2020
(Pradhan Mantri Garib Kalyan Yojana)
Union Finance Minister announced ₹1.70 lakh crore relief package under Pradhan Mantri Garib Kalyan Yojana for the poor to help them fight the battle against COVID-19. Support measures include the following:
• 5 kg wheat/rice per member and 1 kg of pulses per family per month would be provided free of cost for 3 months.
• Jan Dhan women account-holders would be given an ex-gratia of ₹500 per month for three months.
• Direct benefit transfers would be made to poor Divyang, widows and senior citizens.
• Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) wages would be increased by ₹20.
• Gas cylinders would be provided free of cost for 3 months to poor families.
• Medical insurance would be provided to health workers fighting COVID-19.
• The first instalment of ₹2,000 due in 2020-21 under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) will be front-loaded in April 2020.
• State governments will be directed to utilise funds available under District Mineral Fund for COVID-19 health response.
• State governments will be directed to utilise the 'welfare fund for building and other construction workers' to provide support to construction workers.
• Collateral free lending limit for women self-help groups (SHGs) would be increased from ₹10 lakh to ₹20 lakh.
• Mandatory employee provident fund (EPF) contribution, on the part of both employee and employer, shall be borne by the government for three months for low wage earners in businesses with less than 100 workers.
• EPF regulations will be amended to include pandemic as the reason to allow non-refundable advance of 75 per cent of the amount or three months of wages, whichever is lower, from accounts.
March 28, 2020 Ministry of Agriculture and Farmer’s Welfare released a memorandum on extension of dates for conversion of agricultural gold loan and other agricultural accounts into KCC accounts in view of the health emergency due to COVID-19.
March 30, 2020 • Department of Administrative Reforms and Public Grievances advised all Nodal Public Grievance Officers and Government of India departments of the procedure to redress grievances pertaining to COVID-19 expeditiously.
• Benefit of 2 per cent interest subvention to banks and 3 per cent prompt repayment incentive for all farmers was extended up to May 31, 2020 for all crop loans up to ₹3 lakh given by banks, due between March 1 and May 31, 2020.
March 31, 2020 • The Taxation and Other Laws (Relaxations of Certain Provisions) Ordinance 2020 provided relaxation in compliance and enforcement of a plethora of economic laws.
• Foreign Trade Policy 2015-20 was extended for a year and other relaxations were granted in the field of exports and imports procedures.
April 2, 2020 New features of e-NAM platform introduced to help fight against COVID-19.
April 3, 2020 Advance release of central government’s first instalment of State Disaster Risk Management Fund for the year 2020-21, amounting to ₹11,092 crore, with a view to augment funds available with the state governments.
April 4, 2020 • A slew of exemptions and relaxations were granted for agriculture and allied sectors with respect to the 21-day lockdown over the COVID-19 pandemic outbreak so as to ensure that the farmers do not suffer from any adverse fallout. Shops of agricultural machinery, its spare parts (including its supply chain) & repairs and shops for truck repairs on highways, preferably at fuel pumps, were allowed to remain open in order to facilitate transportation of farm produce. Besides, tea industry, including plantations were allowed to function with maximum of 50 per cent workers.
• Under Ministry of Rural Development’s National Rural Livelihood Mission, face mask production was initiated by SHG members in 24 states covering 399 districts of the country.
• Export prohibition of hydroxychloroquine and formulations made from it.
April 8, 2020 • It was announced that all pending income-tax refunds up to ₹5 lakh, and all pending GST and customs refunds would be issued immediately, amounting to total refund of ₹18,000 crore.
• Indian railways introduced unhindered services of time tabled parcel trains for nationwide transportation of essential commodities and other goods to boost the supply chain across the country.
• NGOs permitted to buy foodgrains directly from food corporation of India (FCI) for relief operations at the open market scheme sale rates without going through the auction process.
April 9, 2020 • ₹15,000 crore was sanctioned for ‘India COVID-19 Emergency Response and Health System Preparedness Package’.
• Foodgrains to be provided to non-National Food Securities Act beneficiaries with ration cards issued by state governments.
April 15, 2020 To facilitate transportation of perishable agricultural products, provisions were made for deployment of railways at fast speed, Kisan Rath mobile app and All India Agri Transport Call Centre.
April 18, 2020 The extant Foreign Direct Investment (FDI) policy was amended for curbing opportunistic takeovers/ acquisitions of Indian companies due to COVID-19 pandemic.
May 13, 2020
(Atmanirbhar Bharat Abhiyan - Part I)
• ₹3 lakh crore collateral free loans with 100 per cent credit guarantee cover would be extended to standard businesses/MSMEs.
• ₹20,000 crore subordinate debt with partial credit guarantee support would be extended to non-performing asset (NPA)/stressed MSMEs.
• Fund of funds with corpus of ₹10,000 crore would be created for equity funding of MSMEs with growth potential and viability.
• Definition of MSMEs would be revised to extend benefits to larger number of firms.
• Global tenders for government procurement would be disallowed up to ₹200 crore to support Make in India and e-market linkages for MSMEs will be promoted.
• MSME receivables from government/central public sector enterprises (CPSEs) will be released in 45 days.
• ₹2,500 crore EPF support for eligible businesses and workers will be extended for 3 more months (June to August, 2020).
• For other businesses and workers, EPF contribution will be reduced to 10 per cent each, for 3 months - providing liquidity of ₹6,750 crore.
• ₹30,000 crore special liquidity scheme will be launched for non-banking financial companies (NBFCs)/housing finance companies (HFCs)/microfinance institutions (MFIs).
• The partial credit guarantee scheme will be extended to cover borrowings of lower rated NBFCs, HFCs and MFIs.
• Electricity distribution companies (DISCOMs) will be infused with ₹90,000 crore liquidity.
• Central public sector generation companies will give rebate to DISCOMS, which shall be passed on to the final consumers (industries).
• Measures to de-stress real estate and construction will be taken, contracts will be extended up to 6 months by central government agencies.
• Tax deducted at source (TDS)/Tax collected at source (TCS) rates will be reduced by 25 per cent for remaining period of 2020-21.
• Dates for filing of income tax return and payment under Vivad se Vishwas scheme were further extended.
May 14, 2020
(Atmanirbhar Bharat Abhiyan - Part II)
• Free foodgrains will be provided to migrants who are not beneficiaries of National Food Security Act (NFSA)/State Card, for 2 months. 83 per cent of public distribution system (PDS) population will be covered under ‘One Nation One Ration Card’ scheme by August 2020 for national portability of PDS benefits (100 per cent by March 2021).
• Affordable rental housing complexes (ARHC) will be developed and incentivised for migrant workers/urban poor.
• Interest subvention of 2 per cent will be provided for prompt payees of MUDRA-Shishu loans for a period of 12 months.
• ₹5,000 crore special credit facility will be extended to street vendors.
• Credit linked subsidy scheme for middle income group under Pradhan Mantri Awas Yojana (PMAY)-Urban will be extended up to March 2021 to provide ₹70,000 crore boost to housing sector.
• Compensatory Afforestation Fund Management and Planning Authority (CAMPA) funds to be utilised for afforestation and plantation works to create job opportunities.
• ₹30,000 crore additional emergency working capital funding will be provided to farmers through refinance support from NABARD.
• ₹2 lakh crore concessional credit will be extended to 2.5 crore farmers through Kisan Credit Cards (KCCs).
May 15, 2020
(Atmanirbhar Bharat Abhiyan - Part III)
• Financing facility of ₹1,00,000 crore will be provided for funding agriculture infrastructure projects at farm-gate and aggregation points.
• ₹10,000 crore scheme will be launched for formalisation of micro food enterprises (MFE).
• ₹20,000 crore will be allocated for development of fisheries through Pradhan Mantri Matsya Sampada Yojana (PMMSY).
• Animal Husbandry Infrastructure Development Fund of ₹15,000 crore will be set-up to support private investment in dairy.
• Herbal cultivation and beekeeping initiatives will be promoted.
• Operation Greens will be extended from Tomatoes, Onions and Potatoes (TOP) to all fruits and vegetables.
• Essential Commodities Act, 1955 will be amended to deregulate certain food items.
• Central law will be formulated for barrier free inter-state trade.
• Facilitative legal framework that includes risk mitigation, assured returns, and quality standardisation will be framed to enable farmers to engage with processors/aggregators/large retailers.
May 16, 2020
(Atmanirbhar Bharat Abhiyan - Part IV)
• Private sector participation in commercial coal production and exploration will be permitted; coal gasification/liquefaction will be incentivised; ease of doing business measures will be undertaken; coal bed methane extraction rights will be auctioned from Coal India Limited’s (CIL’s) coal mines; concessions in commercial terms will be given to CIL’s consumers.
• Infrastructure development of ₹50,000 crore will be undertaken in coal sector.
• Seamless composite exploration-cum-mining-cum-production regime will be introduced for enhancing private investments in the mineral sector; 500 mining blocks will be auctioned; bauxite and coal mineral blocks will be jointly auctioned; distinction between captive and non-captive mines will be removed; Mineral Index for different minerals is being developed; stamp duty payable for mining lease will be rationalised.
• A list of weapons/platforms with ban on imports will be notified; imported spares will be indigenised; Ordnance Factory Board will be corporatised; foreign direct investment limit in defence manufacturing under automatic route will be raised to 74 per cent; time-bound defence procurement process will be ushered in.
• Air-space will be managed efficiently leading to reduction in flying cost by ₹1,000 crore per year; world-class airports will be developed through public-private partnership (PPP).
• PPP will be encouraged for establishment of research reactors for production of medical isotopes, irradiation technology for food preservation; and Technology Development cum Incubation Centres will be set up.
• Quantum of viability gap funding for private sector investment in social infrastructure projects will be enhanced with outlay of ₹8,100 crore.
• New tariff policy for power sector will be released and power utilities in union territories will be privatised.
• Private sector will be allowed to use indian space research organisation (ISRO) facilities to improve their capacities; liberal geo-spatial data policy will provide remote-sensing data to tech-entrepreneurs; planetary exploration and outer space travel will be opened for private sector.
May 17, 2020
(Atmanirbhar Bharat Abhiyan - Part V)
• Health and wellness centres in rural and urban areas will be ramped up; infectious diseases hospital blocks will be set up in all districts; lab and surveillance network will be strengthened; and National Digital Health Blueprint will be implemented under the National Digital Health Mission.
• PM e-VIDYA programme, Manodarpan for psycho-social support, new National Curriculum and Pedagogical Framework, and National Foundational Literacy and Numeracy Mission will be launched.
• Special insolvency resolution framework for MSMEs will be notified; fresh initiation of insolvency proceedings will be suspended up to one year; COVID-19 related debt will be excluded from the definition of “default” under IBC for the purpose of triggering insolvency proceedings; private companies which list non-convertible debentures (NCDs) on stock exchanges will not be regarded as listed; penalties for all defaults for small companies/one-person companies/producer companies/start-ups will be lowered.
• Offences (involving minor technical and procedural defaults) under Companies Act will be decriminalised.
• List of strategic sectors requiring presence of public sector enterprises (PSEs) in public interest would be notified; in strategic sectors, at least one enterprise will remain in the public sector but private sector will also be allowed; in other sectors, PSEs would be privatised; and to minimise wasteful administrative costs, number of enterprises in strategic sectors will be only one to four.
• Borrowing limits of states will be increased from 3 per cent to 5 per cent of gross state domestic product (GSDP) for 2020-21, partly linked to specific reforms, leading to extra resources of ₹4.28 lakh crore.
• MGNREGA allocation for 2020-21 will be increased by ₹40,000 crore.
May 23, 2020 Notification on emergency credit line guarantee scheme (ECLGS) for mitigating the economic distress being faced by MSMEs by providing them additional funding of up to ₹3 lakh crore in the form of a fully guaranteed emergency credit line (GECL). The entire funding provided under GECL shall be provided with a 100 per cent credit guarantee by National Credit Guarantee Trustee Company to member lending institutions. Business enterprises/MSMEs with outstanding loan of up to ₹25 crore would be eligible under the scheme for a limited period.
June 1, 2020 Ministry of Agriculture and Farmer’s Welfare released a memorandum on extension of repayment date up to August 31, 2020 for short-term loans up to ₹3 lakh advanced for agriculture including animal husbandry, dairy & fisheries by banks, which have become due or shall become due between March 1, 2020 and August 31, 2020 with continued benefit of 2 per cent interest subvention (IS) to banks and 3 per cent prompt repayment incentive (PRI) to farmers.
June 12, 2020 GST relaxations will be provided to small taxpayers through reduction in late fee, and one time extension in period for seeking revocation of cancellation of registration.
June 20, 2020 Under Garib Kalyan Rojgar Yojana, provision has been made for additional employment to the returnee migrant workers for 125 days in six states facing high reverse migration.
June 24, 2020 Government of India introduced “Distressed Assets Fund – Subordinate Debt for Stressed MSMEs”. A credit guarantee scheme for subordinate debt (CGSSD) was launched under which guarantee coverage would be provided to SCBs which are member lending institutions (MLIs) of CGTMSE for facilitating support to stressed MSMEs. The objective of the credit guarantee scheme is to facilitate loans through banks to the promoters of stressed MSMEs for infusion as equity/quasi equity in the business.
June 30, 2020 Free provision of foodgrains under Pradhan Mantri Garib Kalyan Anna Yojana was extended till November, 2020.
B. Reserve Bank of India
Monetary Policy Department
February 6, 2020 Cash reserve ratio (CRR) exemption to scheduled commercial banks (SCBs) for a period of 5 years (from the date of origination of the loan or the tenure of the loan, whichever is earlier) for the amount equivalent to the incremental credit extended as retail loans for automobiles, residential housing and loans to micro, small and medium enterprises (MSMEs) during January 31, 2020 and July 31, 2020.
March 27, 2020 • Monetary Policy Committee (MPC) advanced its April 2020 meeting to March and reduced the policy repo rate by 75 bps to 4.4 per cent. The reverse repo rate was reduced by 90 bps to 4.0 per cent creating an asymmetrical corridor1.
• CRR reduced2 by 100 bps to 3.0 per cent of NDTL effective March 28, 2020 for a period of one year ending on March 26, 2021.
• Effective March 28, 2020, requirement of minimum daily CRR balance maintenance was reduced from 90 per cent to 80 per cent of the prescribed CRR. This dispensation, initially available up to June 26, was further extended up to September 25, 20203.
• Increase in marginal standing facility (MSF) borrowing from 2 per cent of statutory liquidity ratio (SLR) to 3 per cent effective March 28, 20204. This measure was initially available up to June 30, 2020 and later extended up to September 30, 2020.
April 17, 2020 • The reverse repo rate was reduced by 25 bps to 3.75 per cent.
• Special refinance facilities for a total amount of ₹50,000 crore were provided to NABARD, SIDBI and NHB to enable them to meet sectoral credit needs5.
May 22, 2020 • The June 2020 meeting of the MPC was brought forward and the policy repo rate was reduced by 40 bps to 4.0 per cent.
• The reverse repo rate was reduced by 40 bps to 3.35 per cent.
• A line of credit of ₹15,000 crore was extended to EXIM bank for a period of 90 days from the date of availment with rollover up to a maximum period of one year to enable it to avail a US dollar swap facility to meet its foreign exchange requirements.
Financial Inclusion and Development Department
March 31, 2020 Circular on short-term crop loans eligible for interest subvention scheme (ISS) and prompt repayment incentive (PRI) extending the timeline till June 30, 2020, for converting all short-term crop loans into KCC loans.
June 4, 2020 Circular on ISS and PRI for short-term crop loans during the years 2018-19 and 2019-20 extending moratorium period till August 31, 2020.
Financial Markets Regulation Department
March 27, 2020 The timeline for implementation of legal entity identifier (LEI) in non-derivative markets was extended till September 30, 2020.
April 3, 2020 followed by April 16 and April 30, 2020 The trading hours for various markets under the Reserve Bank’s regulation were revised to ensure that market participants maintain adequate checks and controls while optimising their resources and ensuring safety of personnel.
May 18, 2020 The implementation date for the directions on hedging of foreign exchange risk (dated April 7, 2020) was deferred to September 1, 2020 from June 1, 2020.
May 22, 2020 Foreign portfolio investors (FPIs) that were allotted investment limits under the voluntary retention route (VRR) scheme between January 24, 2020 and April 30, 2020 were allowed an additional time of three months to invest 75 per cent of their committed portfolio size (CPS).
Financial Markets Operations Department
February 6, 2020 Announcement of long-term repo operations (LTROs) to provide durable liquidity at policy repo rate for 1-3 years to augment credit flows to productive sectors. The first such LTRO was conducted on February 17, 2020.
March 12, 2020 It was decided to undertake 6-month US Dollar sell/buy swap auctions to provide US Dollar liquidity to the foreign exchange market6. The first such auction was conducted on March 16, 2020.
March 18, 2020 Net liquidity amounting to ₹1,63,444 crore was injected by the Reserve Bank from March 18, 2020 to June 2020 via open market operation (OMO) including the operations conducted on NDS-OM. The first OMO auction was conducted on March 18, 2020.
March 23, 2020 Announcement of two variable rate term repos amounting to ₹1,00,000 crore. Subsequently, additional variable rate repo operations amounting to ₹75,000 crore were conducted on March 26 and March 31, 2020.
March 24, 2020 The standing liquidity facility (SLF) available to standalone primary dealers (SPDs) was temporarily enhanced from ₹2,800 crore to ₹10,000 crore.
March 27, 2020 Introduced targeted long-term repo operations (TLTROs) under which liquidity availed by banks was to be deployed in investment grade corporate bonds, commercial paper, and non-convertible debentures over and above the outstanding level of their investments in these bonds. The first such TLTRO operation was conducted on March 27, 2020.
March 30, 2020 Extension of the window timings of fixed rate reverse repo and MSF operations as an interim measure so as to provide eligible market participants with greater flexibility in their liquidity management.
April 17, 2020 It was decided to conduct Targeted Long-Term Repo Operations (TLTROs) 2.0 at the policy repo rate. Liquidity availed under the scheme by banks is to be deployed in investment grade corporate bonds, commercial paper, and non-convertible debentures with at least 50 per cent of the total amount availed going to small and mid-sized NBFCs and MFIs. Investments made under this facility would be classified as held to maturity (HTM) even in excess of 25 per cent of total investment permitted to be included in the HTM portfolio. Exposures under this facility would also not be reckoned under the large exposure framework. The first such TLTRO 2.0 auction was conducted on April 23, 2020.
April 27, 2020 In order to ease the liquidity pressure on mutual funds, it was decided to open a special liquidity facility for mutual funds (SLF-MF). Liquidity availed under the scheme by banks is to be deployed exclusively for meeting needs of mutual funds. Liquidity availed under the facility would be classified as HTM even in excess of 25 per cent of total investment permitted to be included in the HTM portfolio. Exposures under this facility would also not be reckoned under the large exposure framework. The first such SLF-MF auction was conducted on April 27, 2020.
April 30, 2020 It was decided to extend regulatory benefits announced under the SLF-MF scheme to all banks, irrespective of whether they avail funding from the Reserve Bank or deploy their own resources to meet liquidity requirements of mutual funds.
Foreign Exchange Department
April 1, 2020 The period of realisation and repatriation to India of the amount representing the full export value of goods or software or services exported was increased from nine months to fifteen months from the date of export, for the exports made up to or on July 31, 2020.
April 3, 2020 It was decided, in consultation with the GoI, to permit receipt of foreign inward remittances from non-residents through the overseas exchange houses in favour of the ‘Prime Minister’s Citizen Assistance and Relief in Emergency Situations (PM-CARES) Fund’, subject to the condition that Authorised Dealers (AD) Category-I banks shall directly credit the remittances to the 'PM-CARES Fund' and maintain the full details of the non-residents sending the donations/contributions under rupee drawee arrangement (RDA).
May 22, 2020 The time period for completion of remittances against normal imports, i.e., excluding import of gold/ diamonds and precious stones/ jewellery (except in cases where amounts are withheld towards guarantee of performance) was extended from six months to twelve months from the date of shipment for such imports made on or before July 31, 2020.
Department of Regulation
March 27, 2020 • Announcement of regulatory measures to mitigate the burden of debt servicing and to ensure the continuity of viable businesses. The salient features included rescheduling of payments for term loans and working capital facilities, easing of working capital financing and exemption from classification of special mention account (SMA) and NPA on account of implementation of the above measures.
• The implementation of the last tranche of 0.625 per cent of capital conservation buffer (CCB) shall stand deferred from March 31, 2020 to September 30, 2020. Accordingly, minimum capital conservation ratios as applicable from March 31, 2018, will also apply for a further period of six months from March 31, 2020 till the CCB attains the level of 2.5 per cent on September 30, 2020. Further, the pre-specified trigger for loss absorption through conversion/write-down of additional tier 1 instruments (perpetual non-cumulative preference shares and perpetual debt instruments) shall remain at 5.5 per cent of risk weighted assets (RWAs) and will rise to 6.125 per cent of RWAs on September 30, 2020.
• The implementation of net stable funding ratio (NSFR) was deferred by six months from April 1, 2020 to October 1, 2020.
April 1, 2020 Based on the review and empirical analysis of counter cyclical capital buffer (CCyB) indicators, it was decided not to activate CCyB (framework for which was put in place in terms of guidelines issued on February 5, 2015, with pre-announcement of the decision to activate it as and when circumstances warranted) for a period of one year or earlier, as may be necessary.
April 17, 2020 • It was decided that in respect of all accounts for which lending institutions decide to grant moratorium or deferment, and which were standard as on March 1, 2020, the 90-day NPA norm shall exclude the moratorium period, i.e., there would be an asset classification standstill for all such accounts from March 1, 2020 to May 31, 2020. At the same time, with the objective of ensuring that banks maintain sufficient buffers and remain adequately provisioned to meet future challenges, they will have to maintain higher provision of 10 per cent on all such accounts under the standstill, spread over two quarters, i.e., March, 2020 and June, 2020. These provisions can be adjusted later on against the provisioning requirements for actual slippages in such accounts.
• Under the Reserve Bank’s prudential framework of resolution of stressed assets dated June 7, 2019, in the case of large accounts under default, SCBs are currently required to hold an additional provision of 20 per cent if a resolution plan has not been implemented within 210 days from the date of such default. Recognising the challenges to resolution of stressed assets in the current volatile environment, it has been decided that the period for resolution plan shall be extended by 90 days.
• With a view to conserve capital of banks to retain their capacity to support the economy and absorb losses in an environment of heightened uncertainty, it was decided that, SCBs shall not make any further dividend payouts from profits pertaining to the financial year ended March 31, 2020 until further instructions. This restriction shall be reviewed on the basis of the financial position of banks for the quarter ending September 30, 2020.
• In order to ease the liquidity position at the level of individual institutions, the LCR requirement for SCBs was brought down from 100 per cent to 80 per cent with immediate effect. The requirement shall be gradually restored back in two phases – 90 per cent by October 1, 2020 and 100 per cent by April 1, 2021.
April 29, 2020 In order to mitigate the difficulties in timely submission of various regulatory returns, due to disruptions on account of COVID-19 pandemic, the timelines for the submission were extended for the regulated entities, permitting a delay of up to 30 days from the due date, which will be applicable to regulatory returns required to be submitted up to June 30, 2020. However, no extension is permitted for submission of statutory returns, i.e. returns prescribed under the Banking Regulation Act 1949, RBI Act 1934 or any other Act (for instance, returns related to CRR/SLR).
May 13, 2020 Interest equalisation scheme on pre and post shipment rupee export credit was extended by GoI for one year, i.e., up to March 31, 2021, with same scope and coverage and all extant operational instructions issued by the Reserve Bank under the said captioned scheme shall continue to remain in force up to March 31, 2021.
May 22, 2020 The bank rate was revised downwards by 40 bps from 4.65 per cent to 4.25 per cent with effect from May 22, 2020. Accordingly, all penal interest rates on shortfall in reserve requirements, which are specifically linked to the bank rate, also stand revised as bank rate plus 3.0 percentage points (7.25 per cent from the earlier 7.65 per cent) or bank rate plus 5.0 percentage points (9.25 per cent instead of the earlier rate of 9.65 per cent), depending on the duration of the shortfalls.
May 23, 2020 • With a view to facilitate greater flow of resources to corporates that faced difficulties in raising funds from the capital market and predominantly dependent on bank funding, caused by sudden market uncertainties, a bank’s exposure under the Large Exposure Framework, to a group of connected counterparties was increased from 25 per cent to 30 per cent of the eligible capital base of the bank. The increased limit will be applicable up to June 30, 2021.
• Taking forward the COVID-19 regulatory package released in March and April 2020, additional measures were announced, providing relaxations in repayment pressures and improving access to working capital by mitigating the burden of debt servicing, for preventing the transmission of financial stress to the real economy, and ensuring the continuity of viable businesses and households on continuous economic disruption due to extension of lockdown.
• Further extension of the resolution timelines, prescribed in the prudential framework for resolution of stressed assets dated June 7, 2019, was provided after a review in continuation of the earlier instructions of April 2020, on account of continued challenges to resolution of stressed assets in a volatile environment. This was applicable in respect of accounts which were within and past the review period as on March 1, 2020, subject to conditions.
• To alleviate genuine difficulties being faced by exporters in their production and realisation cycles, the maximum permissible period of pre-shipment and post-shipment export credit sanctioned by banks was increased from one year to 15 months, for disbursements made up to July 31, 2020. This was in line with the permission already granted for increase in the period of realisation and repatriation of the export proceeds to India from nine months to 15 months from the date of export in respect of exports made up to July 31, 2020.
June 21, 2020 As credit facilities to MSME borrowers, extended under the emergency credit line guarantee scheme of GoI guaranteed by national credit guarantee trustee company (NCGTC), are backed by an unconditional and irrevocable guarantee provided by the GoI, member lending institutions, viz., SCBs (including scheduled RRBs), NBFCs (including HFCs as eligible under the scheme) and AIFIs, were permitted to assign zero per cent risk weight on the credit facilities extended under the scheme to the extent of guarantee coverage.
Department of Supervision
March 16, 2020 Banks and financial institutions were advised regarding an indicative list of measures to be taken by them as part of their operational and business continuity plans.
Consumer Education and Protection Department
April 3, 2020 The consumer education and protection cells at the Reserve Bank’s ROs and all subordinate offices under the centralised public grievance redress and monitoring system (CPGRAMS) were advised regarding the prompt handling of public grievances pertaining to COVID-19 in line with GoI guidelines.
Internal Debt Management Department
April 1, 2020 The WMA limit of state governments/union territories (UTs) were increased by 30 per cent from the limit existing on March 31, 2020, to enable the state governments to tide over the fiscal stress. The revised limits came into effect from April 1, 2020 and will be valid till September 30, 2020.
April 7, 2020 In order to provide greater flexibility to state governments to tide over their cash-flow mismatches, the ‘overdraft (OD) scheme for state governments’ was reviewed and the number of days for which a State/UT can be in OD continuously, was increased from 14 working days to 21 working days. Further, the number of days for which a State/ UT can be in OD in a quarter, was increased from 36 working days to 50 working days.
April 17, 2020 With a view to provide greater comfort to state governments in undertaking containment and mitigation efforts, and to enable them to plan their market borrowings, the WMA limit of states was increased further, by 60 per cent over and above the level existing on March 31, 2020. The increased limit would be valid till September 30, 2020.
April 20, 2020 It was decided in consultation with the GoI, that the limit for WMA of GoI for the remaining part of first half of the financial year 2020-21 (April 2020 to September 2020) will be revised from ₹1,20,000 crore to ₹2,00,000 crore.
May 22, 2020 The ‘scheme for constitution and administration of consolidated sinking fund (CSF)’ was reviewed and the rules governing withdrawal from CSF were relaxed, while ensuring that a sizeable corpus is retained in the Fund.
Department of Payment and Settlement Systems
March 16, 2020 Press release informing the general public about round the clock availability of payment systems that could be used for making payments from comfort of their home by avoiding social contact.
March 24, 2020 Extension of timeline for compliance with various payment system requirements.
June 4, 2020 Further extension in timeline provided to payment system operators to comply with various payment system requirements.
June 22, 2020 Authorised payment system operators and participants were advised to undertake targeted multi-lingual campaigns to educate their users on safe and secure use of digital payments.
1 The purpose of this measure relating to reverse repo rate is to make it relatively unattractive for banks to passively deposit funds with the Reserve Bank and instead, to use these funds for on-lending to productive sectors of the economy.
2 This reduction in the CRR released primary liquidity of about ₹1,37,000 crore uniformly across the banking system in proportion to liabilities of constituents rather than in relation to holdings of excess SLR.
3 This measure was announced taking cognisance of hardships faced by banks in terms of social distancing of staff and consequent strains on reporting requirements.
4 Announced in view of the exceptionally high volatility in domestic financial markets, to provide comfort to the banking system.
5 This comprised ₹25,000 crore to NABARD for refinancing regional rural banks (RRBs), cooperative banks and micro finance institutions (MFIs); ₹15,000 crore to SIDBI for on-lending/refinancing; and ₹10,000 crore to NHB for supporting housing finance companies (HFCs). Advances under this facility were provided at the Reserve Bank’s policy repo rate.
6 This measure was announced as financial markets worldwide were facing intense selling pressures on extreme risk aversion due to the spread of COVID-19 infections.