Economic crisis: Cabinet eases FDI norms in coal mining, announces subsidy for sugarcane farmers

Economic crisis: Cabinet eases FDI norms in coal mining, announces subsidy for sugarcane farmers

The Union Cabinet also announced plans to set up 75 new medical colleges across India. The new establishments will create around 15,700 new MBBS seats

Union ministers Prakash Javadekar and Union Minister Piyush Goyal held a press conference on Wednesday following a cabinet meeting on Tuesday. The ministers announced easing of FDI norms to give a boost to the economy, and the establishment of 75 new medical colleges in the country among other decisions.

Among its decisions, the Cabinet liberalised foreign investment (FDI) norms in coal mining and related infrastructure, contract manufacturing, single-brand retail and digital media. For coal manufacturing and other activities related to its sale related infrastructure, the government has decided to allow 100 per cent FDI via automatic route. The government has also announced 100 per cent FDI in contract manufacturing via automatic route.

The Cabinet has also approved 26 per cent foreign direct investment for digital media. On FDI in single-brand retail, the Cabinet has expanded the definition of mandatory 30 per cent domestic sourcing norm. It also allowed single-brand retailers to start online sales, waiving the previous condition of setting up a mandatory brick-and-mortar store.

"Due to ongoing tensions in the world, companies are looking for new places to set up their manufacturing facilities. Some FDI norms where posing hurdle in attracting such entities to India. These norms have been liberalised to a great extent today. We believe it will help with ease of doing business, influx of foreign investment will increase, FDI regime will be simplified, boost economic growth, promote Make in India and help the youth of the nation get jobs," Commerce Minister Piyush Goyal said while briefing reporters after the Cabinet meeting.

The Cabinet has also approved the establishment of 75 new medical colleges in the country. Javadekar said that the addition would lead to the creation 15,700 more MBBS seats in India.

The Cabinet Committee on Economic Affairs (CCEA) said that the medical colleges would be established by 2021-22 and will be attached with existing district and referral hospitals under Phase-3 of the ongoing Centrally Sponsored scheme.

The government plans to boost the availability of qualified health professionals, improve tertiary care in the government sector and utilise infrastructure of district hospitals and promote affordable medical education in the country with this push.

Javadekar announced that new medical colleges would be set up in under-served regions with no medical college or ones with at least 200 beds. A notification by PIB said that preference will be given to district hospitals with 300 beds.

The CCEA has also approved sugar export policy for evacuation of surplus stocks during sugar season 2019-20. The CCEA gave nod to sugar export subsidy of about Rs 6,268 crore to liquidate surplus domestic stock and help mills in clearing huge sugarcane arrears to farmers.

The government will provide a lump sum subsidy of Rs 10,448 per metric tonne to sugar mills for the sugar season 2019-20, the minister said. The total estimated expenditure of about Rs 6,268 crore will be incurred for this purpose.

The export subsidy will be provided for expenses on marketing costs including handling, upgrading and other processing costs, international and internal transport costs and freight charges.

The subsidy would be directly credited into farmers' accounts on behalf of mills against sugarcane price dues. Subsequent balance, if any, would be credited to mills' account.

The Union Cabinet has also given ex-post facto approval for the establishment of an international Coalition for Disaster Resilient Infrastructure (CDRI). The project will have its supporting secretariat office in New Delhi. PM Narendra Modi will launch the CDRI during UN Climate Summit in New York on September 23, a government statement said.

Organised by the UN secretary general, UN Climate Summit will bring together the largest number of heads of states to generate commitments for combating the effects of climate change and resulting disasters, and will provide the high-level visibility required for the CDRI, the statement said.