Ceat Financial Gets Rs 45-Crore Shot From Rpg

The Cabinet committee on economic affairs yesterday approved the setting up of a Rs 100-crore venture capital fund for the information technology sector.

The committee also cleared Gas Authority of India's proposal to set up a Rs 361.37-crore gas processing complex at Gandhar to meet the growing demand for liquefied petroleum gas in the country.

Information and broadcasting minister Pramod Mahajan said the Gandhar complex would help produce 14 million additional cylinders of LPG (2.07 lakh tonne per annum).

The CCEA also approved a Rs 61-crore modernisation plan for the first stage of the 345 megawatt Salal hydel power project stage in Jammu and Kashmir, Mahajan said.

 

The CCEA's decision to set up a venture capital fund is aimed at providing start-up funding for software professionals and infotech units in the small-scale sector in order to accelerate the industry's rate of growth and encourage exports.

The value of software exports from India is estimated at $2.62 billion in 1998-99 compared with $ 1.75 billion in the previous year. The average growth rate of this industry in the past five years has been 50 per cent, Mahajan said.

The recent initiatives by the government to encourage the infotech industry include introduction of sweat equity in the Companies Act and an amendment in the Income-Tax Act, providing exemption to investments by venture capital funds.

This is besides the guidelines issued by the Reserve Bank of India to ensure that infotech companies are not denied working capital funds by banks.

The Centre also modified Monday's decision to shift education secretary P R Dasgupta as advisor to the Planning Commission. Dasgupta has now been made rural development secretary. Former rural development secretary P L Sanjeeva Reddy has been shifted to the Planning Commission as advisor.

The government also decided to upgrade several officials to the rank and pay of secretary. They are National Pharmaceutical Pricing Authority chairman Arun Kumar, Rural Electrification Corporation chairman Divakar Dev, Planning Commission advisor D P Bagchi, Archaeological Survey of India director-general Ajay Shanka