New Delhi: In a slew of major economic decisions, the Union Cabinet Thursday decided to set up a Cabinet Committee under the Prime Minister to fast track approvals for mega projects of over Rs 1,000 crore and cleared the land acquisition policy for industrialization.
It also approved the long pending urea investment policy that will incentives setting up of new fertiliser plants and expansion of existing ones aimed at cutting import dependence, and simplified procedures for award of road projects faster.
The Cabinet also slashed by 30 percent the base price for telecom airwaves in four circles like Delhi and Mumbai that went unsold in the near flow spectrum auction last month.
The clutch of decisions comes on top of various measures taken by the government in the last few months to prop up economy and to boost investor confidence.
The major decision of the day was setting up of a Cabinet Committee on Investment (CCI) which will accord single-window approval including environmental clearance to mega projects of over Rs 1,000 crore.
There are over 100 projects, each involving investment of Rs 1,000 crore or more, which are held up because of some reason or the other.
The high-powered panel for according speedy clearance to infrastructure projects was initially mooted by Finance Minister P Chidambaram who had suggested at the meeting of the National Development Council creation of a National Investment Board (NIB) for the purpose.
The Cabinet, however, renamed the proposed body as Cabinet Committee on Investment. The panel will have ministers in charge of infrastructure sectors as its members.
Environment Minister Jayanti Natarajan had written to the Prime Minister expressing her reservations over creation of NIB saying nothing should be done to by-pass the required green clearance of mega projects.
On the decision to set up CCI, Prime Minister Manmohan Singh said, "it is a commitment fulfilled".
"All the concerns of the Environment Ministry have been addressed," sources said, adding that the committee would fast track and coordinate mega projects and would not function as an appellate body.
Talking to the reporters, I&B Minister Manish Tewari said, "The Cabinet Committee on Investment has been mandated and tasked with the responsibility of projects of investment over Rs 1,000 crore and ensure expeditious approval if timelines are not adhered to.
"If there are difficulties in big projects in sticking to deadlines, CCI will look into them. And efforts will be made to expedite them."
The Cabinet also cleared the controversial Land Acquisition Bill which makes it mandatory to take the consent of 80 percent of people whose land is taken for private projects.
In the case of Public-Private Partnership projects, the bill makes mandatory obtaining of consent of 70 percent of the people whose land will be for acquired.
The bill was finalised by the Rural Development Ministry incorporating the suggestion of UPA Chairperson Sonia Gandhi who had asked the government to take the consent from 80 percent land owners for purchase of land for the purpose of setting up industries and PPP projects.
Sources had said that Gandhi was not in favour of the Group of Ministers' proposal that the consent of two-thirds of "land losers" (from whom land would be purchased) was enough for acquiring land for industries and PPP projects.
While the industry welcomed the decision on CCI, real estate developers reacted negatively to the stiff consent provisions in the land acquisition bill saying it would jack up land prices.
The Cabinet Committee on Infrastructure decided to simplify procedures to make the awarding of road projects faster.
Under this, the ceiling of 4,000-km of four-laning in National Highway Development Project (NHDP) Phase-IV be raised to 8,000 km under build-own-operate (BOT) mode.
Road stretches with low traffic would be built by Ministry of Road Transport and Highways through contractors.
These decisions, the government said, will expedite the award of projects resulting in improvement of infrastructure.
The Cabinet Committee on Economic Affairs (CCEA) approved a urea investment policy which aims to attract fresh investment of about Rs 35,000 crore to increase domestic production by 8 million tonne.
Under the new policy, the government will give 12-20 percent post-tax return on fresh capital infused by manufacturers for setting up of new plants as well as for expansion and the revamp of the existing ones.
To ensure this return, the government would cover the entire cost of the natural gas, which is main feedstock of urea and accounts 80 percent of the cost.
They also cut by 30 percent the reserve price for mobile phone airwaves in four zones that went unsold in all-India spectrum sale last month.
Airwaves in Delhi, Mumbai, Karnataka and Rajasthan found no taker in the auction as bidders found the prices too high.
"The reserve price for 1800 MHz band in the service areas of Delhi, Mumbai, Karnataka and Rajasthan be reduced by 30 percent from the previous reserve price," an official statement said citing a decision taken by the Union Cabinet at its meeting this evening.
The government also fixed the reserve price for spectrum in 900 MHz band, which will be auctioned simultaneously with 1800 Mhz airwaves in Delhi, Mumbai, Karnataka and Rajasthan.
The spectrum in 900 MHz will be auctioned in Delhi, Mumbai and Kolkata.