A day after Finance Minister Nirmala Sitharaman announced a Rs 1 lakh crore spending package, a top government source said the Centre has not closed its options for another stimulus package.
IMAGE: Finance Minister Nirmala Sitharaman announcing a stimulus package on October 12, 2020. Photograph: PTI Photo.
The government is closely watching the situation and will act accordingly, he said.
The government will take a hit of Rs 6500 crore if it gives a waiver of interest on term loans which issue is currently in the Supreme Court.
According to the official, the government will not differentiate and pass on the benefit to those people also who had not opted for a moratorium and were regularly paying EMIs on their term loan.
The government sources said that however, it will badly hit the financial health of banks. The Supreme Court has adjourned its hearing on a batch of petitions seeking interest waiver during the loan moratorium period to October 14.
The government has not yet decided to appeal in the Vodafone arbitration award. British telco Vodafone Group Plc won a decade-long battle against the income tax department’s demand of Rs 20,000 crore, stemming from its entry into the country in 2007.
The arbitration decision was based on a bilateral investment treaty but legally bilateral has nothing to do with taxation and investment treaty and cannot curb the sovereign power over taxation, the source said.
He further added that we will not let the decision pass without examination.
According to the source, the Centre’s much-awaited new privatisation policy to determine strategic/non-strategic sectors will go to the Cabinet soon.
The source also said that the proposal for setting up an infrastructure financing company will also be taken to the Cabinet soon.