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Companies Spending on oxygen and ventilators are considered as CSR.

Previously, the ministry had permitted companies to use CSR funds to provide "makeshift hospitals and temporary" covid treatment facilities.

CSR funds could be used to build hospital centers for Covid treatment, medical oxygen generation and storage plants, and the manufacture and procurement of oxygen concentrators, tanks, and other medical devices required to combat the pandemic.

According to the ministry, companies may also use CSR funds to collaborate on programs and events with other businesses, as long as they follow the CSR rules and guidelines.

The circular stated that companies' CSR spends could be used to manufacture and supply oxygen concentrators, ventilators, tubes, and other medical devices to combat Covid-19.

The ministry's clarification comes as the pandemic continues to strain India's healthcare system, with hospital beds and oxygen supplies in short supply.

The problem of oxygen scarcity in the national capital has hit the Delhi high court, which has issued government officials with contempt proceedings.

Companies with a net worth of at least 500 crores, annual turnover of at least 1,000 crores, or net profit of at least five crores are required by the Companies Act to invest 2% of their average net income for the previous three years on CSR operations.

Given that corporate earnings could be depressed during the economic crisis, which may affect how much money companies invest in CSR, the government allowed companies more freedom to spend on charity in January.

As a result, they are free to spend more on CSR than their duty—2 percent of net profits—in any given year, and the surplus will be deducted from their CSR investment obligation in subsequent years.

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