The Cabinet on Wednesday has cleared some pending decisions about spending Rs. 1 lakh crore, a maximum share of which will go in to build houses in rural areas as well as an inflation linked expenditure would be spent on government employees.
- Also, an agreement has been signed between the central government and the United Arab Emirates for a long-term investment of $75-billion in India’s infrastructure sector. The Cabinet Committee on Economic Affairs has separately approved new margins (read rates) for main fertilizers which therefore will result in the government saving a considerable amount of subsidy and doubling two railway lines in eastern India expand coal capacity.
- Under the rural housing scheme worth a whopping Rs. 82,000 crore, the government will provide Rs. 1.2 lakh assistance for plain areas and Rs. 1.3 lakh simultaneously in hilly areas in order to build pucca houses to further boost the connectivity of rural India. The agenda of the scheme is to build 1 crore homes within the next 3 years. The National Bank for Agriculture & Rural Development (Nabard) will provide around Rs. 22,000 crore to support the rural housing that will be repaid after the year of 2022. Simultaneously a National Technical Support Agency established to provide financial assistance and ensure speedy delivery.
- The total cost of thee scheme will therefore be shared between the central government and state governments in a 60:40 and 90:10 ratios for plain and hilly areas respectively. The Cabinet has also approved 6% dearness allowance (DA) for central government employees as well as pensioners thereby increasing their income by more than Rs. 15,000 crore in the coming 14 months.
- The Cabinet has also approved the World Bank support of Rs. 9,000 crore for the Swachh Bharat Mission (Gramin). India has in the last month signed a memorandum of understanding (MoU) of $75 billion with the UAE in the National Investment & Infrastructure Fund (NIIF). The government however will hold only 49% of the fund to help private players enter and also is looking for sovereign wealth funds and pension funds to get the rest of the stake. On the other hand, NIIF- a Category II Alternative Investment Fund (AIF) will invest in both Greenfield and Brownfield projects to provide a long-term equity support.