Govt must announce "Paycheque Protection Progarmme" for non-MSMEs: P Chidambaram

Citing the suggestions made by Congress party, to help 6.3 crore MSMEs, Chidambaram said, "We urge the prime minister to look at the proposal and immediately announced the implementation of two specific recommendations, including Rs 1 lakh crore Wage Protection assistance to help MSMEs pay wages and salaries for the month of April, and Rs 1 lakh crore Credit Guarantee fund for MSMEs that will help them to go to the banks and borrow money."

New Delhi: Congress leader and Former Union Minister, P Chidambaram, on Wednesday, urged the Government to announce a 'Paycheque Protection Programme' to protect wages of 1 crore non-MSME employees, as a financial assistance package, in the wake of Coronavirus pandemic.

While addressing the media via video conferencing, P Chidambaram said, "It is bewildering that there has been absolutely no financial package or assistance announced for businesses since the onset of COVID-19. The Government may have the luxury of time but the MSMEs do not."

He mentioned that according to the income tax department, there are roughly 1 crore people who gets a salary of Rs 30,000 per month. By assuming an average salary of Rs 15,000 a month for these 1 crore people, Chidambaram claimed that the total cost comes to Rs 15,000 crore for the month of April.

"This is not a large sum to protect the livelihoods of 1 crore people who have filed tax returns and paid taxes in the past and can easily be found. the government must announce of paycheck Protection Program write a way to protect the salaries of these 1 crore employees," he said.

He also explained the plight of MSME sector, saying, "The businesses have had no sales this month and their payments to vendors are also stuck, leaving the vendors also in distress. Large swathes of the private sector are faced with what economists call and extreme liquidity shock."

Citing the suggestions made by Congress party, to help 6.3 crore MSMEs, Chidambaram said, "We urge the prime minister to look at the proposal and immediately announced the implementation of two specific recommendations, including Rs 1 lakh crore Wage Protection assistance to help MSMEs pay wages and salaries for the month of April, and Rs 1 lakh crore Credit Guarantee fund for MSMEs that will help them to go to the banks and borrow money."

He also suggested for the waiver of emplyoers' contribution to the employees provident fund (EPF) and employees state insurance (ESI), on temporary basis, for the next three months. He said, "This will assist in reducing the payroll costs of employers and retaining the workforce."

He further added, "In the absence of clear signal of assistance from government during these extremely difficult times, the private sector will be forced to Resort to large scale retrenchment and layoff which will devastate livelihood of hundreds of millions of people."

As Finance Minister Nirmala Sitharaman, in a series of tweets, rebutted Congress leader Rahul Gandhi over his allegations on wilful defaulters, by calling then an attempt to "mislead people in a brazen manner", P Chidambaram, on Wednesday, asked her that the Government must explain why it's applying technical loan write-off route for "Fugitives" like Nirav Modi, Mehul Choksi and Vijay Mallya.

FM blamed that the wilful defaulters received benefits of "phone banking" under the UPA regime, while Modi-led government has been after them for recovery, to which Chidambaram replied, during a press conference, "Why does she take shelter behind the technical rule? But why do you apply a technical rule to somebody who has been declared as fugitive, left the country and the government is trying to get him back? Shouldn't the FM have mentioned about Rs 6.66 lakh crore which her government has written off between 2014-19."

He also took a jibe an FM Nirmala Sitharaman, saying, "She was silent from last 37 days, then she suddenly scrounge to life and trying to defend these fugitives. Isn't that a little surprising and ironical?"

Chidambaram asked the government why it had taken the technical loan write-off route for fugitives like Nirav Modi, Mehul Choksi and Vijay Mallya.

He further said one cannot deny the rule that banks can write-off loans technically and recoveries can continue against wilful defaulters, but why was the rule applied to fugitives, who fled the country, after committing frauds.

"One is not denying such a rule that can be applied to a wilful defaulter. But, we are asking these are fugitives and they have left the country and are absconding. Why are you applying this rule to Nirav Modi, Mehul Choksi and Vijay Mallya," he said.

The former finance minister said "when they are fugitives, the technical rule in the book should not be applied to them. That is my view".

(With PTI Inputs)