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Major push to economic reforms: Union Cabinet approves CIL disinvestment, Cochin Shipyards IPO

New Delhi: Taking a step further in government's reform drive, Union Cabinet today took a number of decisions including approval of 10 per cent stake sale in state-owned Coal India Ltd besides initial public offer

India TV Business Desk India TV Business Desk Updated on: November 19, 2015 0:07 IST
union cabinet approves cil disinvestment cochin shipyards
union cabinet approves cil disinvestment cochin shipyards ipo

New Delhi: Taking a step further in government's reform drive, Union Cabinet today took a number of decisions including approval of 10 per cent stake sale in state-owned Coal India Ltd besides initial public offer (IPO) of Cochin Shipyards and 3% interest subsidy for exports.

Announcing the Cabinet decision, Coal and Power Minister Piyush Goyal said that government is expecting to mop up around Rs 20,000 crore from the sale of 10 per cent stake CIL. He added that the timing of the sale will be decided by the Finance Minister Arun Jaitley.

At current market capitalisation, based on CIL stock price, 10 per cent stake sale could fetch about Rs 21,137.71 crore.

This would be little less than the ₹22,557 crore amount the government received when it sold a 10 per cent stake in Coal India on January 31, 2015.

The government had earlier said that it may sell the stake in CIL in the current fiscal through a public offer. It holds 79.65 per cent in the company.

The government has budgeted to raise Rs 69,500 crore through disinvestment in the current fiscal. Of this, Rs 41,000 crore is to come from minority stake sale in PSUs and the remaining Rs 28,500 crore from strategic stake sale.

For disinvestment in 2015-16, the government has a pipeline of over 20 PSUs for which it has the Cabinet approval. These include 10 per cent stake sale each in OIL, Nalco, NMDC, and 5 per cent each in NTPC, ONGC, BHEL.

Cabinet also asked Ministry of Road Transport & Highways to revive 34 stalled projects by appropriate measure where delay is not because of the builder. The ministry has been empowered to clear more projects without going to cabinet where the cost escalation is because of higher compensation for land. Earlier, for extension in such projects, a Cabinet approval was required, said Goyal.

Additionally, the Cabinet approved five railway projects – including one railroad bridge project in Munger, two connectivity projects in Odisha and two in Andhra Pradesh.

The cabinet committee also approved IPO of Cochin Shipyard. The Shipyad reported a net profit of Rs 233 crore in FY15 on a turnover of Rs 1,850 crore.

Home Ministry's proposal for a major revamp of Crime and Criminals Tracking Network and Systems (CCTNS) has also been approved. The Cabinet has decided to implement Integrated Criminal Justice System by integrating CCTNS with e Courts.

It also approved a proposal to provide relief to migrants of the hilly areas of Jammu division, at par with Kashmiri migrants. The proposal aims to provide state Government jobs and transit accommodations in Kashmir Valley for rehabilitation of Kashmiri migrants.

The union cabinet brought back interest subvention scheme for exports providing for 3% subsidy to both pre-shipment and post-shipment credit to exports.

The government has also decided to give direct subsidy to farmers for sugarcane sold to sugar mill at the rate of Rs 4.5/quintal.

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