Cabinet to set 30 Sept as deadline for project clearances
26 Aug 2013
With infrastructure growth on the decline, the union government is fixing a deadline of about one month, till 30 September, for key departments to conclude the government clearances, lack of which has stalled nine major projects entailing investment of Rs92,541 crore.
The Cabinet Committee on Investment (CCI) will meet today 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", according to reports.
The deadline has been set for achieving central government clearances for these mega projects entailing investments of Rs1,000 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 ministry has also sought CCI approval for "appropriate directions" to the coal ministry to facilitate signing of fuel supply agreements for 18 power projects by 30 August.
Growth in eight core sector industries plunged to 0.1 per cent this June compared with 7.9 per cent in the same period last year. The ministry is hoping the 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 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," according to the proposal.
As of 31 March 2013, there were 290 pending projects of Rs250 crore and above, involving a total outlay of Rs11,98,154 crore, out of which banks had committed Rs4,82,652 crore but only Rs2,13,833 crore had been disbursed. Of these, the CCI is monitoring 120 projects of Rs1,000 crore-plus that involve a total outlay of Rs5,41,889 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.
The directives are, therefore, being issued to the coal, power, environment and forests, railways, road transport and highways, commerce and 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.
