New Delhi: A meeting of Union cabinet presided by the Prime Minister Narendra Modi in New Delhi today cleared three important decisions, capital infusion of Rs 6,000 crore in National Investment and Infrastructure Fund, merger of troubled Lakshmi Vilas Bank with DBS India Limited, and foreign direct investment of Rs 2,480 crore in telecom sector company ATC Limited.
“Today, the cabinet decided a capital infusion of Rs 6,000 crore in the National Investment and Infrastructure Fund,” said information and broadcasting minister Prakash Javadekar.
Javadekar said under the Atma Nirbhar Bharat programme, the country seeks to attract investment of Rs 111 lakh crore in the infrastructure sector.
“It will attract an investment of Rs 1.1 lakh crore. The government will infuse Rs 6,000 crore, NIIF will infuse Rs 7,000 crore. And it (NIIF) will raise Rs 1 lakh crore from the bond market, taking the total investment to Rs 1.1 lakh crore fund,” said the minister.
In India, we never tapped the global bond market in a big way. Now the NIIF will attract investment from across the world, Javadekar added.
Cabinet clears merger of LVB with DBIL
In a major decision, the cabinet also cleared the Reserve Bank’s decision to merge Tamil Nadu based Lakshmi Vilas Bank with DBS India Limited (DBL).
On November 17, the Reserve Bank had superseded the board of Lakshmi Vilas Bank and capped the withdrawal from the bank at Rs 25,000 for a period of one month after a committee of three directors failed to attract an investor.
In a surprise move, in September this year, a group of bank’s shareholders had voted out the seven directors including CEO of the bank and statutory auditors, raising concerns over the stability of the bank.
The RBI had then cleared a three member committee of directors (CoD) comprising Meeta Makhan, former IAS Shakti Sinha and Satish Kumar Kalra but the talks with Pramod Bhasin led Clix Capital and other investors did not materialise, forcing the RBI to reconstitute the board and propose the LVB’s merger with DBIL.
“Depositors don't have to worry about their deposits because their bank is merged with a bank which has a very good balance sheet. The interest of 20 lakh depositors, and the jobs of 4,000 people will be protected on the same terms and conditions,” asserted the minister.
FDI investment in telecom sector
The Cabinet also cleared Rs 2,480 crore foreign direct investment in the telecom sector.
“Today the cabinet allowed the FDI by ATC Asia Pacific Limited to the tune of Rs 2,480 crore, for Rs 216 per share for purchasing 12% stock ATC Telecom,” Javdekar told the reporters in a briefing.
Javadekar said now the total FDI in this company will be Rs 5,417 crore.
“It is nearly 98% of the capital therefore it came before the cabinet,” added the minister.
Under the existing rules, if foreign direct investment in a telecom company crosses the mark of Rs 5,000 crore or 50% of the total equity capital then it requires approval from the Union cabinet.
The Cabinet also cleared two MoUs with foreign countries. Under the first memorandum of understanding, sports cooperation between the BRICS nations, Brazil, Russia, India, China and South Africa, will be enhanced by holding international sporting events.
Under the second MoU, Chartered Accountancy Bodies of India and Netherlands will undertake capacity building programmes, said the minister.
(Article by Krishnanand Tripathi)
