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Cabinet Approval on December 15, 2021

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Cabinet Approvals on December 15, 2021The Union Cabinet headed by Prime Minister (PM) Narendra Modi approved the following important initiatives on December 15, 2021.

-Approved Incentive Scheme to Promote RuPayDebit cards and BHIM-UPI Transaction

The cabinet has approved an incentive scheme with an estimated financial outlay of Rs 1,300 crore (for 1 year i.e. FY22) to promote RuPayDebit cards and low-value (up to Rs 2,000) BHIM-UPI (Bharat Interface for Money – Unified Payments Interface) transactions (Person-to-Merchant (P2M)) in India.

Key Points:

i.Under the scheme, the acquiring banks will get small amounts of incentives (a certain percentage of the value of transactions) from the Government for transactions (P2M) that has been done through RuPay Debit cards and low-value BHIM-UPI modes of payments.

ii.Background:  The scheme has been formulated in compliance with the Budget announcements (FY22) to give a further boost to digital transactions in the country.

iii.Objective: To build a robust digital payment ecosystem and promote RuPay Debit card and BHIM-UPI digital transactions, across unbanked and marginalized populations, who are outside of the formal banking and financial system.

Note – In November 2021 India has seen a record number of digital transactions at 423 crore valued at Rs 7.56 lakh crore (nearly $ 100 billion).

-Approved Rs 76,000 crore scheme for Semiconductor Manufacturing

Cabinet approved a production linked incentive (PLI) scheme with an outlay of Rs 76,000 crore to boost semiconductor and display manufacturing in India, making the total amount of incentives announced for the electronics sector to Rs 2.30 lakh crore.

  • Objective: To provide incentive support to companies / consortia that are engaged in Silicon Semiconductor Fabs (Fabrication plant), Display Fabs, Compound Semiconductors / Silicon Photonics / Sensors (including MEMS (Micro Electro-Mechanical System)) Fabs, Semiconductor Packaging (ATMP (Assembly –Testing-Marking-and Packaging)/OSAT (Outsourced Semiconductor Assembly and Test)), Semiconductor Design.

Fiscal Support for Semiconductors and Electronics:

i.In addition to the approval of Rs 76,000 crore (>10 billion USD) scheme to boost semiconductor and display manufacturing in India, Government of India (GoI) has also approved incentives for every part of the supply chain including electronic components, sub-assemblies, and finished goods.

  • Incentive support to the tune of Rs 55,392 crore (7.5 billion USD) under PLI for Large Scale Electronics Manufacturing, PLI for IT Hardware, SPECS Scheme and Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme.
  • PLI incentives to the quantum of Rs 98,000 crore (USD 13 billion) for allied sectors comprising of ACC battery, auto components, telecom & networking products, solar PV modules and white goods.

ii.In total, GoI has committed support of Rs 2.30 lakh crore (USD 30 billion) to position India as a global hub for electronics manufacturing with semiconductors as the foundational building block.

Note – The program will promote higher domestic value addition in electronics manufacturing and will contribute significantly to achieving a USD 1 Trillion digital economy and a USD 5 Trillion GDP by 2025.

Incentives approved for semiconductors and display manufacturing:

i.Semiconductor Fabs and Display Fabs: The Scheme for Setting up of Semiconductor Fabs and Display Fabs in India shall extend fiscal support of up to 50 percent of the project cost.

ii.Semi-conductor Laboratory (SCL): Union Cabinet has also approved the modernization and commercialization of the Semi-conductor Laboratory (SCL) through the Ministry of Electronics and Information Technology (MeitY).

  • MeitY will explore the possibility for the Joint Venture of SCL with a commercial fab partner to modernize the brownfield fab facility.

iii.The Scheme for Setting up of Compound Semiconductors / Silicon Photonics / Sensors (including MEMS) Fabs and Semiconductor ATMP / OSAT facilities in India shall extend fiscal support of 30 percent of capital expenditure to approved units.

iv.Semiconductor Design Companies: The Design Linked Incentive (DLI) Scheme will extend product design linked incentive of up to 50 percent of eligible expenditure and product deployment linked incentive of 6 – 4 percent on net sales for five years.

v.India Semiconductor Mission:  ‘India Semiconductor Mission (ISM)’ was planned to be set up to drive the long-term strategies for developing sustainable semiconductors and display ecosystem.

  • The mission will act as the nodal agency for efficient and smooth implementation of the schemes on Semiconductors and Display ecosystem.

Note – As per the data of the Semiconductor industry association, United States firms tops global semiconductor sales in 2020 with 47 percent sales followed by South Korea (20%) and Japan (10%).

-Approved Implementation of PMKSY for 2021-26 

Cabinet has approved the extension of implementation of Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) for 2021-26 with an outlay of Rs 93,068 crore to benefit about 22 lakh farmers, including 2.5 lakh Scheduled Caste and 2 lakh Scheduled Tribe farmers.

  • The scheme was launched in 2015-16 with a total of 99 projects identified, out of the 99, 46 have been completed. The rest of the projects will be completed by 2024-25.
  • During PMKSY 2016-21 the Cabinet Committee on Economic Affairs (CCEA) has approved central support of Rs 37,454 crore to States and Rs 20,434.56 crore of debt servicing for loans availed by the Government of India for irrigation development.

Programmes approved for continuation during PMKSY 2021-26:

Accelerated Irrigation Benefit Programme (AIBP), Har Khet ko Paani (HKKP) and Watershed Development components have been approved for continuation during PMKSY 2021-26.

i.AIBP – It is a flagship programme of the Government to provide financial support to irrigation projects. An additional irrigation potential creation of 13.88 lakh hectares was targeted under AIBP during 2021-26.

  • Currently, the programme focused completion of 60 ongoing projects including their 30.23 lakh hectare command area development.

ii.HKKP – It aims for the enhancement of physical access on the farm and the expansion of cultivable areas under assured irrigation. Under HKKP, surface minor irrigation and repair-renovation-restoration of water bodies’ component of PMKSY is targeted to provide additional 4.5 lakh hectare irrigation.

iii.Watershed Development – Central funding of 90 percent of water component for two national projects, namely Renukaji Dam Project (Himachal Pradesh) and Lakhwar Multipurpose Project (Uttarakhand) has been provisioned.

  • The two projects would lead to storage in the Yamuna basin benefitting 6 states of the upper Yamuna basin, augmenting water supply to Delhi, Himachal Pradesh, Uttarakhand, Uttar Pradesh, Haryana and Rajasthan.

-Cleared Bill on Electoral Reforms

The cabinet cleared a Bill on electoral reforms, including one to link the electoral roll with Aadhaar on a voluntary basis to root out multiple enrolments.


In August 2015 the Supreme Court has ordered and mentioned the requirement to sanction of law to collect the Aadhaar number.

In the backdrop of such order, the Election Commission of India (ECI) had proposed amendments including linking of the ID card with Aadhaar number which will curb multiple enrollments of the same individual at different places.

Provisions of the Bill:

i.The electoral law will be made ‘gender-neutral’ for service voters.

ii.The bill will allow new voters to enrol on 4 different dates every year.

  • Existing Provision: As of now, those turning 18 on or before January 1 of every year are only allowed to register as voters.

iii.ECI had asked the law ministry to replace the term ‘wife’ with ‘spouse’ in the provision in the Representation of the People Act related to service voters.

  • Existing Provision: An army man’s wife is entitled to be enrolled as a service voter, but a woman army officer’s husband is not entitled to such provision.

Approves Treaty between India and Poland over legal assistance in criminal matters

Cabinet has also approved the Treaty on Mutual Legal Assistance in Criminal Matters between the Government of the Republic of India and the Republic of Poland.

  • Objective: To enhance the capability and effectiveness of both countries in the investigation and prosecution of crimes, including crimes related to terrorism.
  • The treaty will provide a broad legal framework for bilateral cooperation with Poland in the investigation and prosecution of crime in tracing, restrain and confiscation of proceeds and instruments of crime as well as the funds meant to finance terrorist acts.
  • It will also increase the effectiveness of India in tackling criminal activities involving Poland.

Recent Related News:

In November 2021, the Union Cabinet approved a bill to repeal the 3 farm laws, which were passed by Parliament in September 2020, with an objective to bring reforms in the agriculture sector, especially the marketing of farm produce.

Cabinet has approved the extension of the free foodgrain distribution scheme under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY)- Phase V for another 4 months i.e. from December 2021 to March 2022, with an estimated additional food subsidy of Rs 53344.52 Crore.