Cabinet increases the limit for foreign investment in Stock Exchanges from 5% to 15%

Cabinet increases the limit for foreign investment in Stock Exchanges from 5% to 15% 

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for raising foreign shareholding limit from 5% to 15% in Indian Stock Exchanges for a stock exchange, a depository, a banking company, an insurance company, a commodity derivative exchange. The Cabinet has also approved the proposal to allow foreign portfolio investors to acquire shares through initial allotment, besides secondary market, in the stock exchanges.


The move will help in enhancing global competitiveness of Indian stock exchanges by accelerating/facilitating the adoption of latest technology and global best practices which will lead to overall growth and development of the Indian Capital Market.

The approval is in pursuance of implementation of the Budget Announcement made by the Finance Minister Shri Arun Jaitley while presenting the Union Budget 2016-17 regarding reforms in FDI Policy with respect to enhancement of investment limit for foreign entities in Indian stock exchanges from 5% to 15% on par with domestic institutions.

*****

Cabinet approves rescinding the decision of the Government to set up the Concurrent Evaluation Office in Ministry of Rural Development

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has decided to rescind the earlier decision of the Government to set up the Concurrent Evaluation Office (CEO) for managing Concurrent Evaluation Network (CENET) in Ministry of Rural Development. The CEO was envisaged to undertake concurrent evaluation of Rural Development programmes in conjunction with Independent Evaluation Office (IEO) of the erstwhile Planning Commission.

The decision will pave the way for a need based strengthening of the Economic and Monitoring Wing of the Ministry of Rural Development for managing and carrying out evaluation studies of Rural Development programmes.

***

Cabinet approves abolition of Separate Guidelines for establishing Joint Venture Companies by Defence PSUs

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved abolition of existing "Guidelines for establishing Joint Venture Companies by Defence Public Sector Undertakings (DPSUs)". These guidelines which were notified in February, 2012 will not be required for separate JV by the DPSUs. The Guidelines issued by the Department of Public Enterprises (DPE) and Ministry of Finance (MoF) from time to time, which are uniformly applicable to all Central Public Sector Enterprises (CPSEs) will be applicable for the DPSUs to set up JV companies now. This will meet the goal of indigenization / self-reliance in this sector.

The abolition of the existing JV Guidelines will provide a level playing field between DPSUs and the private sector. It will allow DPSUs to forge partnerships in an innovative manner enhancing self-reliance in defence and provide for enhanced accountability / autonomy of DPSUs in ensuring that the process of JV formation is effectively managed by them, so as to secure best outcomes in the interest of national security.

All nine DPSUs i.e. Mazagon Dock Limited, Goa Shipyard Limited, Garden Reach Shipbuilders & Engineers Limited, Hindustan Shipyard Limited, Bharat Electronics Limited, Hindustan Aeronautics Limited, Bharat Earth Movers Limited, Bharat Dynamics Limited and Mishra Dhatu Nigam Limited will be benefited through this decision.

The decision comes in the backdrop of the issues which emerged in the operationalisation of JV guidelines of DPSUs. The Department of Defence Production came to the conclusion that with the increasing participation of the private industry in defence sector and the transformation taking place in the defence acquisition eco system thereon, the requirement of having separate JV guidelines for DPSUs is no longer considered necessary. In the emerging scenario with primacy being accorded to indigenous manufacturing / Make in India, it is felt that having multiple set of guidelines may lead to ambiguity and incongruity in the environment.

Background:

Defence Production Policy promulgated in January 2011 with the objective of achieving substantive self-reliance in defence production including design and development capability had recommended that all viable approaches including JVs to be undertaken to achieve the desired self-reliance in defence production. Consequent to this, a need was felt to supplement the DPE guidelines with formulation of JV protocols / guidelines tailored for DPSUs which would address the specific requirements of the defence sector and also ensure that the interests of DPSUs were safeguarded. Accordingly the existing Guidelines for establishing Joint Venture Companies by DPSUs was approved by the Cabinet during the meeting held on 9th February, 2012 and the same was notified on 17th February, 2012. Now, the requirement for having separate JV Guidelines for DPSUs has been reviewed in the context of the increasing participation of the private industry in defence sector and the transformation taking place in the defence acquisition eco system.

*****

Cabinet approves Policy for award of Waterfront and associated land to port dependent industries in major ports

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the Policy for award of waterfront and associated land to port dependent industries in major ports and its operationalization.

The Policy will result in uniformity and transparency in the procedure for awarding captive facilities. It will enable optimal utilization of capacities in major ports and increase revenue to the Major Port Authority. The ambit of the Policy includes creation of new assets as well as utilization of currently unutilised existing assets such as vacant berths. The Policy will be applicable to all the Major Ports.

Under the Policy, concession will be granted to Port Dependent Industries (PDI) for setting up dedicated facilities in Major Ports for import and/or export of cargo and their storage before transportation to their destination, for a period not exceeding 30 years. Extension of concession period on conditions including under utilization of asset as per the Concession Agreement may be allowed.

After a maximum of 30 years of operation, the waterfront and associated land in a Major Port will be allotted for construction of berths, offshore anchorages, transhipment jetties, single point moorings etc. It will be as per the terms and conditions of the Concession Agreement (CA) to be entered into between the Port Authority and the PDI concerned.

Under the existing guidelines for private sector participation in Major Ports issued by the Ministry of Shipping (MoS) in 1996 and 1998, provisions have been made for allotment of waterfront and land on a captive basis to Port Based Industries including Central/State Public Sector Undertakings (PSUs) which fulfil the prescribed eligibility criteria. Though, some berths and facilities have been set up in some Major Ports following these Guidelines, the potential for development of such facilities is not yet fully realized.

Government of India has focused on Port led development through the Sagarmala program as a key enabler for economic growth. Optimal utilization of land and waterfront at the disposal of the Major Ports is of critical importance in this context. The objective of this Policy is to ensure uniformity and transparency in the procedure for awarding captive facilities. The policy will help generate committed business for the Major Ports on a long term basis by facilitating the development and operation of dedicated port facilities by industries which are substantially dependent on a particular Major Port for import and/or export of their cargo and thus play a catalytic role in the eventual realization of the objectives of Port led development.

Background:

The Government of India is committed to improving the level and quality of physical and social infrastructure in the country of its goal of achieving national economic prosperity. In pursuance of this goal, the Government has envisaged a substantial role for Public Private Partnerships (PPPs) as a means for harnessing private sector investment and operational efficiencies in the provision of public utilities and services. Allocation of waterfront and associated land to Port based Industries on PPP/captive basis is one of the areas which have been identified for participation/investment by the private sector in Major Ports.

***

Cabinet approves Bilateral Investment Treaty between India and Cambodia to boost investment

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved Bilateral Investment Treaty (BIT) between India and Cambodia.

The Treaty seeks to promote and protect investments from either country in the territory of the other country with the objective of increasing bilateral investment flows. The Treaty encourages each country to create favourable conditions for investors of the other country to make investments in its territory and to admit investments in accordance with its laws.

The Treaty is the first Bilateral Investment Treaty in accordance with the text of the Indian Model BIT, approved by the Cabinet in December, 2015.

*****

Cabinet approves setting up of new AIIMS in Bhatinda

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the establishment of a new AIIMS at Bhatinda in Punjab under the Pradhan Mantri Swasthya Suraksha Yojana (PMSSY).

The institution shall have a hospital with capacity of 750 beds which will include Emergency/Trauma Beds, AYUSH Beds, Private Beds and ICU Speciality & Super Speciality beds. In addition, there will be an Administration Block, AYUSH Block, Auditorium, Night Shelter, Hostels and residential facilities.

The cost of the project for establishment of the new AIIMS in Bhatinda shall be Rs. 925 crore. The above cost estimate does not include recurring costs (wages & salaries and operation & maintenance expenses). The recurring expenditure will be met by the respective new AIIMS from their annual budgets through Grant-in-Aid to them from Plan Budget Head of PMSSY of Ministry of Health and Family Welfare.

The new AIIMS at Bhatinda will provide super specialty health care to the population while creating a large pool of doctors and other health workers in this region that can be available for primary and secondary level institutions/facilities being created under National Health Mission (NHM). The institute will also conduct research on prevalent regional diseases and other health issues and provide for better control and cure of such diseases.

The project will be completed in a period of 48 months from the date of the approval by the Government of India. It consists of a pre-construction phase of 15 months, a construction phase of 30 months and stabilization /commissioning phase of 3 months.

The population in Punjab and adjoining regions will be benefited by this AIIMS.

Background:

The Central Sector Scheme, Pradhan Mantri Swasthya Suraksha Yojana (PMSSY) was first announced in August 2003 with the primary objective of correcting the regional imbalances in availability of affordable/reliable tertiary level healthcare in the country in general, and to augment facilities for quality medical education in under-served or backward States, in particular.

Under this scheme AIIMS have been established in Bhubaneshwar, Jodhpur, Raipur, Rishikesh, Bhopal and Patna while work of AIIMS Rae Bareli is in progress. Also, three AIIMS in Nagpur (Maharashtra), Kalyani (West Bengal) and Mangalagiri in Guntur (A.P) have been sanctioned in 2015.

*****

Cabinet approves Amendment in the Central Agricultural University Act, 1992

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the amendment in relevant clauses of the Central Agricultural University Act (CAU), 1992 to include State of Nagaland under the jurisdiction of CAU, Imphal.

After inclusion of State of Nagaland under jurisdiction of the Central Agricultural University, Imphal, the College of Veterinary Sciences in Nagaland will produce the much-needed professional manpower in the fields of animal husbandry, which will facilitate socio-economic growth in the region. The new college will help familiarize the farmers with new techniques, thereby contributing to the production and productivity of domestic animals in the State of Nagaland.

The amendment will help the State of Nagaland reap the benefit of the CAU, Manipur, which is established for the entire North Eastern Region.

***

Cabinet approves Revised Cost Estimate for NATRIP Project


The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the revised cost estimate for Rs. 3727.30 crore for the National Automotive Testing and R&D Infrastructure Project (NATRIP). This approval ensures completion of the projects under NATRIP which is an important Initiative by the Government of India for the establishment of the global test centres in India. This will address the R&D requirements of the automotive industry, full-fledged testing and homologation centres. The places are within the Northern auto-cluster at ICAT-Manesar, Haryana and Southern auto-cluster at GARC-Oragadam, Chennai, Tamil Nadu and up-gradation of existing centers at ARAI- Pune and VRDE-Ahmednagar in Maharashtra for Western auto-cluster.

The NATRIP project is required:
·         To adopt global best practices to ensure road safety, environmental protection etc. in design, manufacture, testing and operation of motor vehicles in India since India is signatory to UN Regulation on Harmonisation of Vehicle Specifications under WP-29 of 1998.
·         To support Automotive Mission Plan 2016-26 sets the Indian automotive & component manufacturers for becoming globally competitive for export with aim to scale up exports to the extent of 35-40% of its overall output over the next 10 years
·         To make Indian vehicles comply with global standard of safety (in line with UN Brasilia resolution) to reduce the high number of casualities and road accidents (i.e. 1.46 and 5.01 lakhs respectively in the year 2015).
·         To help the MSMEs for development and certification of auto-components, both for OEMs and after sale parts.

The essential components include world class labs for Powertrain, Passive Safety Tests l (including crash tests), Tracks for proving technology (including the High Speed Track at Indore), fatigue and certification, Electro-magnetic Compatibility tests, Noise Vibration & Harshness tests, CAD & CME and Infotronics.  Many of the labs are already operational. These infrastructure will also enable the vehicle and component manufacturers to develop and get certificates in the country, for automotive products which confirm to the world standards thus implementing the ‘Make in India’ objective.
                                 
The following is the summary of the automotive client base and services offered, in order to make NATRiP centres locally and globally competitive and to make them fully integrated with the established Auto Hubs so that Indian industry is world class and export competitive by giving impetus to the “Make in India” program as well.

(a)   Categories of customers served:

Four wheeler manufacturers/Commercial vehicle manufacturers/ Three wheeler Manufacturers/ Two wheeler Manufacturers/Construction equipment vehicle manufacturers/ Agriculture equipment (Tractors) manufacturers/E-Rickshaw manufacturers/ Bus body Manufacturers/ CNG-LPG kit retrofitters/Automotive & Non-Automotive engine Manufacturers/DG set manufacturers/Automotive Component Manufacturers.

(b)   Services offered:

i. Certification of various vehicle categories, including HEV/EV/Diesel/Gasoline/CNG/LPG etc. as per CMVR-1989.
ii. Certification of notified components of vehicle as per CMVR-1989 and related IS/AIS.
iii.Export certification for vehicles and components for Europe/South Africa/Malaysia/ Indonesia/Brazil etc. for Indian manufacturers, in collaboration with other authorized agencies.
iv. Developmental testing for the automotive industry, OEMs and components both, for their product development needs.
v.Execution of specific product development projects for the automotive industry.
vi.Developmental vehicle/fleet testing, performance evaluation and endurance testing.
vii. Technology development and R&D projects
viii.Data collection for new regulations framing.