India Govt announces steps to arrest economic slowdown

New Delhi, Feb 16 (PTI) Giving a push to economy hit by slowdown, the Indian government Wednesday unveiled a slew of policy measures including relaxation of spectrum rules for the telecom companies, assuring coal linkages to power sector and according environmental clearances to a mega hydel project. A flurry of activities in the economic ministries, apparently at the instance of the Indian Prime Minister's Office (PMO), is aimed at sending a strong signal that the government wants to tackle the slowdown by fast-tracking decision making, sources said. The economic growth rate during the current fiscal ending March 31, 2012 is expected to slowdown to 6.9 per cent from 8.4 per cent a year ago. At the instance of the PMO, Coal India will sign by March end agreements for supply of fuel to power projects commissioned up to December 2011. The decision addresses long-standing tussle between the state-controlled coal sector and private power producers and follows constitution of a Committee of Secretaries (CoS) constituted by the Prime Minister to look into issues. Giving a major advantage to old GSM operators, the government said all telecom service providers would be allowed to hold higher spectrum of up to 10 MHz. Current prescribed limit is 6.2 MHz of GSM spectrum. In another important decision, Environment Minister Jayanthi Natarajan has given the green signal for construction of a 1,750 MW Demwe Lower hydro electric project in the northeast Indian state of Arunachal Pradesh on Lohit river, overrulling ecological concerns. Sources said that the Prime Minister's office was in favour of giving green clearance to the project, as demanded by the state government. In order to give a boost to the National Manufacturing Policy, the government announced that units in the proposed mega industrial enclaves will be given highest priority for environmental clearances. Besides, the procedures for green approvals have been relaxed, exempting the individual units within proposed National Manufacturing and Investment Zones (NMIZs) from public hearings, once they have been held for the entire zone, provided they are notified by the concerned state government. Meanwhile, the Empowered Group of Ministers (EGoM), headed by Finance Minister Pranab Mukherjee decided to offload five per cent equity in the Indian energy major ONGC through the auction route. The decision would help the government in mopping up Rupees 120.0 billion (nearly USD 2.45 billion) from disinvestment within the current 2011-12 financial year. With less than one-and-half months to go for the current fiscal to end, the government has managed to raise only Rs 11.45 billion (about USD 230 million) from stake sale in Power Finance Corporation (PFC). PTI