Cabinet Committee on Economic Affairs Current Affairs - 2020

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CCEA approves launch of KUSUM scheme

The Cabinet Committee on Economic Affairs (CCEA) has approved the launch of KUSUM, Kisan Urja Suraksha evam Utthaan Mahabhiyan scheme. The scheme aims to provide financial and water security to farmers through harnessing solar energy capacities of 25.75 gigawatts (GW) by 2022.

Component of the Scheme

The scheme has three components:

  • 10,000 megawatt (MW) of decentralised ground mounted grid-connected renewable power plants (Component-A).
  • Installation of 17.50 lakh standalone solar powered agriculture pumps (Component-B).
  • Solarisation of 10 lakh grid-connected solar powered agriculture pumps (Component-C).

Component-B will be implemented in a full-fledged manner whereas Component-A and Component-C will be implemented on pilot mode for 1,000 MW capacity and one lakh grid-connected agriculture pumps, respectively. They would be scale up later after the pilot run.

Features of the Scheme

Component-A
  • Renewable power plants of capacity 500 kilowatts (kW) to 2 MW will be set up by individual farmers, cooperatives, panchayats, or farmer producer organisations (FPO) on their barren or cultivable lands.
  • The power generated will be purchased by the distribution companies (Discoms) at tariffs determined by respective state electricity regulatory commissions (SERC).
  • The scheme will open a stable and continuous source of income to the rural landowners.
  • Performance-based incentives at Rs 0.40 per unit for five years will be provided to Discoms.
Component-B
  • Individual farmers will be supported in installing standalone solar pumps of capacity up to 7.5 horsepower (HP).
  • Solar PV capacity in kW equal to the pump capacity in HP is allowed under the scheme.
 Component-C
  • Individual farmers will be supported to solarise pumps of capacity up to 7.5 HP.
  • The farmer will be able to use the generated energy to meet the irrigation needs and the excess available energy will be sold to Discom.
  • This creates an avenue for extra income to the farmers, and for the states to meet their renewable purchase obligation (RPO) targets.

The scheme will have a substantial environmental impact in terms of savings of CO2 emissions. It is estimated that three components of the scheme combined together would result in savings of about 27 million tonnes of CO2 emission per annum.

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Government Approves Continuation of CLCS-TUS Scheme for MSMEs

The Cabinet Committee on Economic Affairs (CCEA) has approved a three-year extension of the Credit Linked Capital Subsidy and Technology Up-gradation Scheme (CLCS-TUS) for Micro, Small and Medium Enterprises (MSME) with a total outlay of 2,900 crores on 13th February 2019. This scheme will continue beyond the 12th Five Year Plan for three years from 2017-18 to 2019-20.

What is the CLCS-TUS Scheme?

  • Under this scheme, an upfront capital subsidy of 15 per cent will be provided to the MSMEs on institutional finance of up to Rs 1 crore availed by them. This will be done to help the MSMEs in employing well-established and improved technology in the specified 51 sub-sectors/products approved.
  • The scheme aims to improve the competitiveness of MSMEs by integrating various current schemes aimed at up-grading technology through Credit Linked Capital Subsidy, hand holding for zero defect zero effect manufacturing, increasing productivity through waste reduction, design intervention, cloud computing, facilitation of intellectual property and nurturing new ideas.
  • It will also focus on improving the quality of products and enhancement in productivity. This will promote a culture of continuous development.
  • The scheme also incorporates special provisions to increase entrepreneurship for SC/STs, women, hill states, island territories and the aspirational districts/ LWE (Left-wing extremism) districts.

Comment

The MSME sector has emerged as a highly vibrant and dynamic sector of the Indian economy. They not only provide employment in the rural areas but are also a prelude to industrialization. MSMEs are complementary to large industries as ancillary units and this sector contributes enormously to the socio-economic development of the country.

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