India's Union cabinet is set to meet today where it may decide on selling stakes in public sector units and central public sector enterprises, in an aim to garner more revenue to meet its fiscal goals.
The Cabinet has approved a unified authority to regulate all financial services at the IFSC, GIFT City In Gujarat.
Eight regulatory organisations including RBI, SEBI and PFRDA will all be brought together regulate financial services. All eight will have a unified window under one chairman. They shall, in one place, govern all activities in IFSC.
The Cabinet has approved that the National Highway Authority of India may monetise public-funded national highway projects which are operational and have been collecting toll for one year.
Earlier, only those highways which have been collecting toll for two years can be monetised.
NHAI also gets authorised to vary the concession period between 15-30 years depending on the project's features. Earlier, this was for 30 years.
The highway builder has also been authorised to raise long-term finance from banks by securitising the user fee receipts from toll plazas as an alternate mode of asset monetisation.
Finance Minister Sitharaman said that in cases where government entity has challenged the arbitral award, and as a result, the amount of an arbitral award has not been paid, 75 percent of the award will be paid by the government entity against a bank guarantee.
The Cabinet has approved a strategic divestment of the government’s 53.29 percent stake Bharat Petroleum Corporation Ltd. divestment to a strategic buyer, along with transfer of management control. This will exclude BPCL’s 61 percent stake in Numaligarh Refinery in Assam. That stake will be moved out of BPCL before the disinvestment and retained by the government.
The mop-up from public sector undertakings’ stake sales assumes significance against the backdrop of the corporate tax cuts, which will cost the government Rs 1.45 lakh crore in revenue in the ongoing financial year. This also raises questions whether India will be able to achieve its fiscal deficit target for 2019-20. This also comes at a time when India’s GDP growth fell to its lowest in six years.
Just yesterday, the government categorically stated that it does not intend to revise its fiscal deficit target of 3.3 percent of gross domestic product for the current financial year notwithstanding slowdown in economic activity.
India’s Union Cabinet is set to meet today where it may decide on selling stakes in public sector units and central public sector enterprises, in an effort to garner more revenue to meet fiscal goals.
