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Atmanirbhar Bharat Abhiyan — Complete Guide to Self-Reliant India

Everything about Atmanirbhar Bharat — the &rupee;20 lakh crore economic package, 5 pillars, revised MSME definitions, ECLGS credit guarantee, PLI schemes, sector reforms, and Vocal for Local opportunities.

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Updated 2026
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Atmanirbhar Bharat Abhiyan — Step-by-Step Guide

Prepared by TaxClue's CA/CS team. Updated for 2026.

What Is Atmanirbhar Bharat Abhiyan?

Announced on 12 May 2020 by Prime Minister Narendra Modi, Atmanirbhar Bharat Abhiyan (Self-Reliant India Mission) is an economic vision and stimulus package worth &rupee;20 lakh crore (approximately 10% of India's GDP at the time). It was designed to revive the economy post-COVID while building long-term self-reliance in critical sectors. The mission is not about protectionism — it emphasises global competitiveness, domestic manufacturing capability, and reduced import dependence in strategic areas like defence, semiconductors, pharma, and energy.

The 5 Pillars of Atmanirbhar Bharat

The mission rests on five pillars — (1) Economy: quantum-leap reforms, not incremental change; (2) Infrastructure: world-class infrastructure that becomes the identity of modern India; (3) System: technology-driven, 21st-century governance systems that replace outdated processes; (4) Vibrant Demography: leveraging India's young population as the world's largest talent and consumer base; (5) Demand: utilising the strength of India's domestic demand and supply chain. Each pillar drives policy reforms, budgetary allocations, and regulatory changes.

Revised MSME Definitions

Atmanirbhar Bharat brought a landmark revision of MSME classification (effective 1 July 2020). The new composite criteria combine investment and turnover — Micro: investment up to &rupee;1 crore and turnover up to &rupee;5 crore; Small: investment up to &rupee;10 crore and turnover up to &rupee;50 crore; Medium: investment up to &rupee;50 crore and turnover up to &rupee;250 crore. The distinction between manufacturing and services was removed. This expansion brought millions of previously excluded enterprises under the MSME umbrella, giving them access to priority sector lending, government procurement preferences, and scheme benefits.

ECLGS — Emergency Credit Line Guarantee Scheme

ECLGS is the crown jewel of Atmanirbhar Bharat's MSME relief. Originally launched with &rupee;3 lakh crore guarantee cover (expanded to &rupee;5 lakh crore), ECLGS provides 100% government-backed credit guarantee to banks lending to MSMEs, businesses, and professionals. ECLGS 1.0 covered existing borrowers; ECLGS 2.0 targeted healthcare; ECLGS 3.0 covered hospitality, travel, and civil aviation; ECLGS 4.0 supported hospitals for setting up on-site oxygen plants. Over &rupee;3.76 lakh crore has been sanctioned to 1.2+ crore borrowers. The scheme provided a lifeline to businesses during and after the pandemic.

PLI Schemes — Production-Linked Incentives

PLI is Atmanirbhar Bharat's flagship industrial policy, allocating &rupee;1.97 lakh crore across 14 sectors to incentivise domestic manufacturing. Major outcomes by 2026 — mobile phone production in India crossed US$50 billion (India is now the world's second-largest smartphone manufacturer); semiconductor fabs under construction in Gujarat and Assam; pharmaceutical API domestic production reducing import dependence from 68% to under 50%; electronics exports grew 5x since PLI inception. Companies like Apple (via Foxconn, Tata Electronics), Samsung, and Dixon Technologies have scaled Indian manufacturing under PLI.

Reforms in Defence, Space & Coal

Defence: FDI limit raised to 74% (automatic), positive indigenisation lists for 400+ items, defence corridors in Tamil Nadu and UP, and Ordnance Factory corporatisation into 7 new DPSUs. Defence exports reached &rupee;23,000+ crore. Space: ISRO opened up to private sector participation through IN-SPACe (Indian National Space Promotion and Authorisation Centre); companies like Agnikul, Skyroot, and Pixxel launching commercial missions. Coal: Commercial mining opened to private sector, ending Coal India's monopoly; revenue-sharing model replaces fixed royalty; 100+ coal blocks allocated. Agriculture: APMC reforms, &rupee;1 lakh crore Agri Infrastructure Fund, and free food grain distribution to 80 crore people.

Vocal for Local & Domestic Procurement

The “Vocal for Local” movement encourages citizens and government to prefer domestically manufactured products. Policy mechanisms include — (a) Public Procurement Order 2017 (revised) mandating preference to “Make in India” products with minimum 50% local content; (b) GeM portal promoting local sellers (25% MSME reservation, 3% women-owned MSME); (c) One District One Product (ODOP) programme identifying unique products from each district for national and global markets; (d) Import substitution lists published by DPIIT; (e) Quality Control Orders (QCOs) ensuring BIS-standard compliance for imported goods.

Special Liquidity & Financial Measures

Beyond ECLGS, Atmanirbhar Bharat included — (a) &rupee;30,000 crore Special Liquidity Scheme for NBFCs/HFCs/MFIs through a government-guaranteed SPV; (b) &rupee;45,000 crore Partial Credit Guarantee Scheme for NBFCs; (c) &rupee;20,000 crore subordinate debt for stressed MSMEs; (d) &rupee;50,000 crore equity infusion through Fund of Funds for MSMEs via SIDBI; (e) TDS/TCS rates reduced by 25% for FY 2020–21; (f) EPF contribution reduced from 12% to 10% for 3 months; (g) &rupee;3 lakh crore collateral-free automatic loans for MSMEs with 4-year moratorium. Total liquidity injection exceeded &rupee;8 lakh crore across RBI and government measures.

Labour & Structural Reforms

Atmanirbhar Bharat accelerated the consolidation of 29 central labour laws into 4 Labour Codes — Code on Wages (2019), Industrial Relations Code (2020), Social Security Code (2020), and Occupational Safety Code (2020). Key changes include — universal social security for gig and platform workers, definition of “worker” expanded, fixed-term employment formalised, threshold for retrenchment raised, and a universal EPF and ESI framework. State governments have been implementing the codes in phases. The reforms aim to balance worker protection with ease of doing business for employers.

How to Leverage Atmanirbhar Bharat for Your Business

Step 1: Register as an MSME on the Udyam portal (udyamregistration.gov.in) to access all MSME benefits including ECLGS, procurement preferences, and subsidised credit. Step 2: Check PLI eligibility for your manufacturing sector at pli.gov.in. Step 3: Register on GeM for government procurement opportunities. Step 4: Explore NSWS for single-window approvals. Step 5: If in defence/space, register with MoD/IN-SPACe for indigenisation opportunities. Step 6: Apply for CGTMSE or ECLGS through your bank. Step 7: Engage TaxClue for Udyam registration, GST compliance, tax filing, and maximising scheme benefits.

Frequently Asked Questions
What is the &rupee;20 lakh crore Atmanirbhar Bharat package?
The &rupee;20 lakh crore package (approximately 10% of GDP) includes direct fiscal spending, RBI liquidity measures, credit guarantees, and structural reforms. It was announced in 5 tranches in May 2020. Key components include &rupee;3 lakh crore ECLGS for MSMEs, &rupee;1 lakh crore Agri Infrastructure Fund, &rupee;30,000 crore for NBFCs, free food grains for 80 crore people, EPF support, and various sector-specific measures. Not all of it was direct government expenditure — a significant portion comprised credit guarantees and liquidity injections.
What are the new MSME definitions under Atmanirbhar Bharat?
Micro enterprise: investment up to &rupee;1 crore AND turnover up to &rupee;5 crore. Small enterprise: investment up to &rupee;10 crore AND turnover up to &rupee;50 crore. Medium enterprise: investment up to &rupee;50 crore AND turnover up to &rupee;250 crore. Both criteria must be met (the lower classification applies if they fall in different categories). The distinction between manufacturing and services MSMEs was removed. Export turnover is excluded from the turnover calculation.
Is ECLGS still available in 2026?
ECLGS was available for fresh sanctions until 31 March 2023 (the last extension). While new sanctions have closed, existing ECLGS loans continue to be serviced with their original terms (up to 6 years including moratorium). However, the Government periodically announces sector-specific credit guarantee schemes. Check with your bank or contact TaxClue to explore current credit guarantee options available for your business type.
How does Vocal for Local benefit my small business?
If you manufacture in India with minimum 50% local content, you benefit from — (a) price preference of up to 20% in government procurement under Public Procurement Order; (b) 25% reservation for MSMEs in government purchases on GeM; (c) participation in ODOP programme for district-specific products; (d) reduced competition from imports in categories where QCOs mandate BIS certification; (e) consumer preference driven by the Vocal for Local awareness campaign. Register on GeM and get BIS/Quality certifications to maximise these advantages.
Can startups benefit from Atmanirbhar Bharat?
Yes. Startups benefit through multiple channels — (a) DPIIT-recognised startups get all Startup India benefits (tax holiday, self-certification, patent rebate); (b) Fund of Funds for Startups via SIDBI; (c) GeM registration for government procurement; (d) PLI participation if in eligible manufacturing sectors; (e) IN-SPACe for space-tech startups; (f) iDEX (Innovations for Defence Excellence) for defence-tech startups with grants up to &rupee;1.5 crore; (g) liberalised angel tax rules (now abolished entirely). The Atmanirbhar Bharat ecosystem strongly supports the startup economy.
What are the 4 Labour Codes and how do they affect employers?
The 4 codes consolidate 29 laws — (1) Code on Wages: uniform minimum wage, timely payment; (2) Industrial Relations Code: easier hire/fire for units with up to 300 workers, fixed-term employment, standing orders; (3) Social Security Code: EPF/ESI for gig workers, universal social security; (4) OSH Code: occupational safety, working hours (8-hour shifts with 48-hour weekly limit), annual leave rules. Employers need to review employment contracts, update PF/ESI compliance, and adjust payroll systems. States are implementing codes in phases — consult TaxClue for current status in your state.
How do I get Udyam MSME registration?
Udyam registration is free, paperless, and permanent. Visit udyamregistration.gov.in, enter your Aadhaar number and PAN/GSTIN. The system auto-fetches investment and turnover details from government databases. Classification (Micro/Small/Medium) is done automatically. No documents to upload, no fees to pay, no renewal required. The Udyam Registration Number (URN) is generated instantly. This URN is needed for all MSME benefits including ECLGS, CGTMSE, GeM procurement preferences, and priority sector lending. TaxClue can assist if you face any issues during registration.
What is the difference between Atmanirbhar Bharat and Make in India?
Make in India (2014) focuses specifically on transforming India into a global manufacturing hub through FDI, ease of doing business, and sector-specific support. Atmanirbhar Bharat (2020) is a broader economic vision encompassing self-reliance across all sectors — manufacturing, agriculture, defence, space, healthcare, and digital. Make in India is now a key pillar within the Atmanirbhar Bharat framework. PLI schemes, which are central to both, were announced as part of Atmanirbhar Bharat but are implemented under the Make in India umbrella.

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