Modi govt clears clutch of moves to revive projects, boost revenue

Measures include revival of stalled road projects, 10% stake sale in CIL, and interest subvention for exporters

The government on Wednesday announced a clutch of measures – including a stake sale on Coal India, revival of stalled projects, and interest relief for exporters, among others – aimed largely at propping up sagging revenues in the face of a global demand slump.

At a time when markets remain volatile due to global cues, the Cabinet cleared a 10% disinvestment in the Coal India Ltd (CIL), besides approving an initial public offer (IPO) for Cochin Shipyard, power minister Piyush Goyal said in a post-Cabinet meeting briefing. 

The move came at a time when the government is finding it hard to raise even half of the budgeted Rs 69,000 crore from disinvestment and strategic sales. 

The government will also address the problems of at least 34 road projects that are currently stalled. All projects that were not stuck due to developers’ problems would be re-started again. Besides, to meet the rising compensation of land for road projects, the government will divide the road cost into civil construction and capital.

It will also restart the long-stalled project, since at least 1997-98 and one that has seen considerable demand locally, to build a rail-cum-road bridge over the Ganga river in Bihar. The project is estimated to cost Rs 27,774 crore.

The government also acquiesced to a long-pending demand of merchandise exporters to restore a 3% interest subvention in a bid to arrest falling exports. Indian exports declined for the 11th month in a row in October, a period longer than what was witnessed even in the aftermath of the 2008 financial crisis.

The subvention will be available for both pre-shipment and post-shipment credits, Goyal said. The government had earlier announced revamped Merchandise Exports from India Scheme (MEIS) and hiked duty drawback rates for various products to help exporters.