With infrastructure growth on the decline,the Centre is fixing a months deadline,till September-end,for key departments to conclude the government clearances that have stalled nine major projects entailing an investment of Rs 92,541 crore.
The Cabinet Committee on Investment (CCI) will meet Monday to direct the departments to take appropriate action immediately so that the bottlenecks in the stalled projects could be removed,necessary approvals are granted and these projects could be implemented within the agreed and revised time frame.
The deadline has been set as September 30 for achieving central government clearances for these projects entailing investments of Rs 1,000 crore and above,that have been stuck for over a year for want of regulatory clearances. The timeline has been kept open-ended for obtaining state government approvals.
The finance ministrys proposal also seeks CCI approval for appropriate directions to the coal ministry to facilitate signing of fuel supply agreements for 18 power projects by August 30.
Growth in eight infrastructure industries plunged to 0.1 per cent this June compared to 7.9 per cent in the same period last year. The ministry is hoping that tomorrows move will stimulate credit flows while checking the increase in occurrence of bad loans in the banking sector.
Removal of bottlenecks in the stalled projects would not only facilitate in achieving a higher growth rate of GDP but would also arrest NPA (non-productive asset) creation for banks and financial institutions and would free lendable resources for creating a cycle of lending by these institutions, says the proposal.
As on March 31,2013,there were 290 projects of Rs 250 crore and above involving a total outlay of Rs 11,98,154 crore,out of which banks had committed Rs 4,82,652 crore but only Rs 2,13,833 crore had been disbursed. Of these,the CCI is monitoring 120 projects of Rs 1,000 crore-plus that involve a total outlay of Rs 5,41,889 crore.
Power,road,iron and steel,cement and ports are the major sectors where projects are delayed due to coal linkages,environment clearances,land acquisitions and their handing over,among others.
The directives are,therefore,being issued to the coal,power,environment & forests,railways,road transport & highways,commerce & industry,mines,urban development and water resources ministries. Their compliance has to be intimated monthly to the project monitoring group a special cell in the cabinet secretariat.
Prime Minister Manmohan Singh had said last month that his government will act boldly and decisively to accelerate economic growth and that speedier execution of infrastructure projects was critical to push that growth.
Build war chest Of $20 BILLION
Foreign and domestic financial institutions have asked the finance ministry to build a war chest of at least $20 billion as foreign exchange reserves to fight the depreciation of the rupee.
THE government plans to ask several public sector financial institutions to raise money from abroad.