Economic Affairs Secretary Subhash Chandra Garg today said the introduction in the Lok Sabha of the bill seeking to deal with insolvency of financial service providers is a significant step. The Financial Resolution and Deposit Insurance Bill, 2017 was today introduced by Minister of State for Finance Arun Ram Meghwal. Soon after, it was referred to the 30-member committee comprising members of both the Lok Sabha and the Rajya Sabha. The committee is expected to submit its report during the next session. "Financial Resolution and Deposit Insurance Bill, 2017 introduced in Lok Sabha today.
Significant step to bring in financial firm resolution," Garg said in a tweet. The bill provides for establishment of a resolution corporation with powers relating to transfer of assets to a healthy financial firm, merger or amalgamation, liquidation to be initiated by an order of the National Company Law Tribunal. It can also designate certain financial providers as systematically important financial institutions, the failure of which may disrupt the entire financial system, said the 'Statement of Objects and Reasons' of the bill. It also provides for creation of corporation insurance fund, corporation resolution fund and corporation general fund. Garg in another tweet said, "Government laid down Medium Term Fiscal Framework Policy today in the Parliament. Signals continued adherence to fiscal consolidation." The government today also tabled the Medium-term Expenditure Framework Statement (MTEF) in Parliament. According to the MTEF document, the total expenditure of the central government is likely to touch Rs 26 lakh crore in 2019-20, up from Rs 21.46 lakh crore estimated for the current fiscal. It further said the Centre's capital expenditure is expected to rise 25 per cent to Rs 3.9 lakh crore in 2019-20, with defence outlay alone jumping 22 per cent.
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