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Cabinet Approvals on July 17, 2019

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The Cabinet Committee on Economic Affairs chaired by the Prime Minister Shri Narendra Modi has approved the following proposals on July 17, 2019:Cabinet ApprovalApproval to the expenditure on 2880 MW Dibang Multipurpose Project in Arunachal Pradesh at Rs. 1600 crore
Approval was given to the expenditure on pre-investment activities and various clearances for Dibang Multipurpose Project (MPP) in Arunachal Pradesh for an amount of Rs. 1600 crore. It is located on river Dibang, in Lower Dibang Valley District of Arunachal Pradesh.
Key Points:

  • Cost: The estimated total cost of Project is Rs. 28080.35 including IDC (Interest During Construction) & FC of Rs 3974.95 crore at June 2018 price level.
  • Tenure: The estimated completion period for the project shall be nine years from receipt of Government sanction.
  • Benefits: The project shall generate 2880 MegaWatts (12x240MW) power to produce 11223MU of energy in a 90% dependable year. The dam is 278 metres high. It will be the highest dam in India once completed. The Government of Arunachal Pradesh will get 12% free power from the project i.e. 1346.76 MU (Million Units). 1% free power (i.e. 112 MUs) will be given in Local Area Development Fund(LADF). The total value of benefit to Arunachal Pradesh from Free power and contribution to LADF will be Rs 26785 crore over the project life of forty years.
  • Statutory clearances: The project is having all statutory clearances viz. TEC, Environment Clearance, Forest Clearance (Stage-l) and Defence Clearance except Forest Clearance (Stage-II) for seeking Investment Sanction from Govt. of India.

Approval to the extension of the term of the Fifteenth Finance Commission up to November 30, 2019
Approval was given to the extension of the term of the Fifteenth Finance Commission up to November 30, 2019. It will help the Commission to examine various comparable estimates for financial projections in view of reforms and the new realities to finalize its recommendations for the period 2020-2025.
Key Points:

  • Background: The Fifteenth Finance Commission was constituted by the President of India on November 27, 2017 in pursuance of clause (1) of Article 280 of the Constitution and Finance Commission (Miscellaneous Provisions) Act, 1951. The Commission had to submit its Report on the basis of its Terms of Reference (ToR) by October 30, 2019 covering a period of five years commencing from 1st April, 2020.
  • Reason: The ToR of the Commission takes into account the fiscal/budgetary reforms. The task of determining the expenditure and receipts of the Union and State governments based on which the Commission shall make its recommendations is time consuming, as checks for data consistency across time and data sets become challenging.
  • Fiscal/budgetary reforms: They include the reforms introduced by the Union Government in the past four years like closure of the Planning Commission and its replacement by NITl Aayog, removal of distinction between Non-Plan and Plan expenditure, advancing the budget calendar by one month and passing of the full budget before commencement of the new financial year i.e. on 1st February, introduction of Goods and Services Tax (GST) from July 2017 and New Fiscal Responsibility and Budget Management (FRBM) architecture with debt and fiscal deficit path.

Approval to the Amendment in the Terms of Reference (ToR) for the Fifteenth Finance Commission 
Approval was given to the Amendment in the Terms of Reference (ToR) for the Fifteenth Finance Commission to address serious concerns regarding the allocation of adequate, secure and non-lapsable funds for defence and internal security of India.
Key Points:

  • Under the ToR of the Commission, it is proposed to ensure an assured allocation of resources towards defence and internal security imperatives.
  • It provides that Fifteenth Finance Commission should examine whether a separate mechanism for funding of defence and internal security ought to be set up and if so how such a mechanism could be operationalized.

Approval to the Implementation of the Cabinet’s decision dated 28.12.2016 regarding pharmaceutical companies 
Approval was given to the implementation of the Cabinet’s decision dated 28.12.2016 regarding pharmaceutical companies in the public sector seeking modification therein.

i. Modifying the earlier decision dated 28.12.2016 of sale of land of Public Sector Undertakings (PSUs) to government agencies and instead permitting the sale of land as per revised Department of Public Enterprises’s (DPE) guidelines dated 14.06.2018.
ii. Providing budgetary support as loan to the tune of Rs 330.35 cr. for meeting the employees’ liabilities (Unpaid salary – Rs. 158.35 cr. + VRS- Voluntary retirement scheme Rs.172.00 cr.) as per following break-up:

  • Indian Drugs and Pharmaceuticals Limited (IDPL) – Rs. 6.50cr.
  • Rajasthan Drugs & Pharmaceuticals Limited (RDPL)- Rs.  43.70cr.
  • Hindustan Aeronautics Limited (HAL)   – Rs. 280.15 cr.

iii. Constitution of a Committee of Ministers for taking all decisions pertaining to closure/ strategic sale of the four Public Sector Undertakings, including the sale of assets and clearance of outstanding liabilities.

On 28.12.2016, Cabinet had decided to sell surplus land of HAL, IDPL, RDPL and Bengal Chemicals & Pharmaceuticals Ltd. (BCPL) through open competitive bidding to Government agencies and clear the outstanding liabilities from the sale proceeds. It was decided that after meeting the liabilities, IDPL and RDPL would be closed and HAL and BCPL put up for strategic sale. But Department could not find buyers, despite issuing tenders more than once. So, the DPE had issued revised guidelines on 14.06.2018 in respect of disposal of land of the PSUs. As funds could not be generated through the sale of surplus land, the employees in few of the PSUs (HAL and RDPL) could not be paid salaries and VRS scheme floated. Therefore, it was decided to dispose of the land as per revised DPE’s guidelines and seek up-front budgetary support for meeting employees’ liabilities.

Approval to Double New Bongaigaon-Agthori via Rangiya railway line
Approval was given to construct the New Bongaigaon and Agthori via Rangiya doubling (142.97 km) of Northeast Frontier Railway in Assam with an estimated cost of Rs. 2042.51 crore. The project will be completed by 2022-23. It will be executed by Construction Organization of Northeast Frontier Railway.

  • It will traverse through Bongaigaon, Baksa, Barpeta, Nalbari and Kamrup districts of Assam.
  • It will help to remove the existing capacity constraints of existing network and handle the increasing freight and passenger traffic by doubling of New Bongaigaon – Agthori via Rangiya. Overall operative performance of New Bongaigaon – Agthori via Rangiya will improve by the doubling and congestion of section will also reduce to a great extent.

Approval to boost Railway Connectivity between Allahabad and Mughalsarai
Approval was given to construct third railway line between Allahabad – Mughalsarai (now Pt. Deen Dayal Upadhyaya Junction.) (Length 150 km) Uttar Pradesh with an estimated cost of Rs. 2649.44 crore. It will be completed by 2023-24 and will be executed by Construction Organization of North Central.

  • It will help to overcome with the future traffic, remove capacity constraints and enhance capacity, reduce detention and cater for future growth of traffic.
  • It will also ease traffic congestion at Chheoki, Naini and improve the punctuality of goods and passenger trains on vital route connecting National capital.

Approval to boost to Rail Connectivity in Uttar Pradesh
Approval was given to construct a new railway line between Sahjanwa and Dohrighat (81.17 Km), Uttar Pradesh with an estimated cost of Rs. 1319.75 crore which will be completed by 2023-24. It will be executed by Construction Organization of North Eastern Railway.

  • It will provide rail facility to the people of the area falling under the project line and will help in growth of small-scale industries in the area.
  • It will also generate direct employment during construction for about 19.48 lakh mandays.

Approval to set up National Medical Commission
Approval was given to the National Medical Commission Bill, 2019 which provides for the setting up of a medical commission in place of Medical Council of India (MCI) and repeal of the Indian Medical Council Act, 1956.
Key Points:

  • The Common Final year Bachelor of Medicine, Bachelor of Surgery (MBBS) exams to be known as National Exit Test (NEXT). They will serve as licentiate exam for entrance to PG (Post graduate) medical courses and as a screening test for foreign medical graduates.
  • NEET and NEXT shall be applicable to Institutes of National Importance (INIs) like All India Institute of Medical Sciences (AIIMS) to have common standards in the country.
  • The Commission will regulate fees and all other charges for 50% seats in private medical colleges and deemed universities.
  • The Medical Assessment and Rating Board (MARB) will conduct assessment to the medical college and develop a system of ranking medical colleges which would enable the students to choose the medical college wisely. It will grant permission for new medical colleges, starting PG course and increase of seats based on the standards set by the UG (Under Graduate) and PG boards.
  • National Medical Commission will have 4 Autonomous Boards, namely Under-Graduate Medical Education Board, Post-Graduate Medical Education Board, Medical Assessment and Rating Board and Ethics and Medical Registration Board.
  • The strength of the Autonomous Boards has been increased from 3 to 5 and it includes 2 part-time members. One of them will be a doctor selected by the Government and the other will be an elected doctor from State Medical Council.

Approval to Repealing and Amendment Bill, 2019 to scrap 58 Redundant Laws
Approval was given to Repealing and Amendment Bill, 2019 to scrap 58 laws which have lost their relevance, in an effort to weed out archaic and dead statutes.
Key Points:

  • After the Repealing and Amendment Bill, 2019 gets parliamentary nod, 137 laws have lost their relevance will be scrapped in the next lot.
  • Some of the old acts that have been repealed are the Hackney Carriage Act 1879, Dramatic Performance Act 1876, The Ganges Tolls Act, 1867.
  • Background: In 2014, a two-member panel was set up to look into the repealing of archaic laws and the panel also consulted the Centre and the state government before recommending the legislation to be repealed. In September 2014, the Law Commission had said that while studying the issue, it found that a large number of Appropriation Acts passed during the past several years in reality have lost meaning but continue to be part of the statute books.

Approval to NID Amendment Bill 
Approval was given to amend the National Institutes of Design (NID) Act, 2014, to include 4 new such centres within the ambit of the law and declare them as institutions of national importance. The four new NIDs which would be included are in Amaravati, Bhopal, Jorhat, and Kurukshetra. They will be able to grant a degree, diploma, and other academic distinctions.

  • By granting the status of institutions of national importance to new NIDs, they will ensure that design education becomes socially inclusive and address the needs of design in various sectors including agriculture, health care, and transportation.
  • An Institute of National Importance in India is defined as one which serves as a pivotal player in developing highly skilled personnel within the specified region of the country or state.

About Union Cabinet:
The Union Council of Ministers exercises executive authority in India. It consists of senior ministers called cabinet ministers, junior ministers called ministers of state and, rarely, deputy ministers. It is led by the Prime Minister.