Page 13 - Banking Finance April 2016

ROUNDUP
Budgetary Support from
Finmin will help fund
capital outlay lakh crore:
Prabhu
The Railway Minister Suresh Prabhu
assured the Lower House that mon-
ies would be found to finance the
colossal capital plan of Rs. 1.21 lakh
crore. Breaking away from the aver-
age capital expenditure of Rs.
48,100 crore between 2009 and
2014, the Railways Budget has
pegged its investments at double the
average of previous years.
Prabhu said Gross Budgetary Support
from the Finance Ministry, Railway
Development Fund, extra budgetary
resources among the avenues that
would help fund the capital outlay of
Rs. 1.21 lakh crore.
Prabhu also defended the Modi-led
Government's plans to spend huge
sums of money on a single "bullet
train" project (Ahmadabad-
Bombay), stating that "spin-off" ben-
efits would be felt across the entire
rail network.
He highlighted that the bullet-train
project was a standalone and self-fi-
nancing one and the Government of
Japan was financing it at very soft
terms. "The funding from Japan will
come at 0.1 per cent interest and
involves repayment in 50 years with
moratorium for 15 years. Any banker
will tell you this is like almost giving Programme and also various special projects and future projects to be awarded
you free money," Prabhu said.
BANKING FINANCE |
WTO rules against India in solar power dispute
India lost a case at the World Trade Organization (WTO) after the global trade
body said power purchase agreements signed by the gov-
ernment with solar firms for the ambitious National So-
lar Mission did not meet international norms. The United
States had filed a complaint before the WTO on this is-
sue in 2014, alleging foreign firms would not be able to
take part in India's electrification programmes and the
lucrative government contracts that came with it.
It said a clause relating to domestic content requirement (DCR) for the pro-
curement of solar cells and modules under Phase-I and Phase-II of the Jawaharlal
Nehru National Solar Mission were discriminatory and "nullified" the benefits
accruing to American solar power developers.
Labour Ministry's Bill to empower Centre to fix mini-
mum wage
The Labour Ministry has sent a Bill that empowers the Centre to fix a national
minimum wage floor across sectors to the Union Cabinet
for its approval. "We have already sent the Wage Code
Bill for Cabinet approval. We will also send the Labour Code
on Industrial Relations Bill for Cabinet approval," Labour
Secretary Shankar Aggarwal told.
Aggarwal said 44 labour laws are being consolidated into
four labour codes, of which two had been finalised and the other two were un-
derway. "The two codes on social security and working conditions will be finalised
in a month," he said. At present, minimum wages vary across the country as
States fix these for different categories of workers in various sectors.
NHAI to raise Rs. 3,300 cr via tax-free bonds for imple-
mentation in projects
The National Highways Authority of India will raise Rs 3,300 crore by selling tax-
free bonds. The funds raised through this issue will be utilised for the part-fi-
nancing of various ongoing projects under the National Highways Development
under different modes.
According to a government press release, the tax-free, secured, redeemable
non-convertible bonds will have a face value of Rs 1,000 each for an amount of
Rs 500 crore, with an option to retain over-subscription of up to additional Rs
2,800 crore, aggregating up to a total of Rs 3,300 crore.
Foodgrain production to increase 253.16 million tonnes
India's foodgrain production is estimated to increase
to 253.16 million tonnes (mt) in 2015-16 crop year
which is an improvement in the output of wheat and
pulses despite back-to-back drought. The estimate is
however; lower than the record 265.04 mt in the 2013-
14 crop year (July-June), but slightly better than 252.02
mt in last year.
APRIL | 2016 | 13