Tag Archives: Union Cabinet

Cabinet approves 49% FDI in Air India

The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval to a number of amendments in the FDI Policy -one of them allowing foreign airlines to invest up to 49 per cent under approval route in Air India. These are intended to simplify the FDI policy to provide ease of doing business in the country. As per the extant policy, foreign airlines are allowed to invest under Government approval route in the capital of Indian companies operating scheduled and non-scheduled air transport services, up to the limit of 49 per cent of their paid-up capital. However, this provision was presently not applicable to Air India, thereby implying that foreign airlines could not invest in Air India. Foreign airlines can now invest up to 49 per cent under approval route in Air India subject to the conditions that foreign investment(s) in Air India including that of foreign airline(s) shall not exceed 49 per cent either directly or indirectly. Substantial ownership and effective control of Air India shall continue to be vested in Indian National.

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Cabinet approves merger of rail budget with general budget

The Union Cabinet has approved the proposals of Ministry of Finance on certain landmark budgetary reforms relating to the merger of Railway budget with the General budget, the advancement of the date of Budget presentation from the last day of February and the merger of the Plan and the Non-Plan classification in the Budget and Accounts. All these changes will be put into effect simultaneously from the Budget 2017-18. The Railways will continue to maintain its distinct entity -as a departmentally run commercial undertaking as at present; Railways will retain their functional autonomy and delegation of financial powers etc. as per the existing guidelines; The existing financial arrangements will continue wherein Railways will meet all their revenue expenditure, including ordinary working expenses, pay and allowances and pensions etc. from their revenue receipts; The capital at charge of the Railways estimated at Rs.2.27 lakh crore on which annual dividend is paid by the Railways will be wiped off. Consequently, there will be no dividend liability for Railways from 2017-18 and Ministry of Railways will get Gross Budgetary support. This will also save Railways from the liability of payment of approximately Rs.9,700 crore annual dividend to the Government of India; The presentation of separate Railway budget started in the year 1924, and has continued after independence as a convention rather than under Constitutional provisions. The merger would bring the affairs of the Railways to centre stage and present a holistic picture of the financial position of the Government. The merger is also expected to reduce the procedural requirements and instead bring into focus, the aspects of delivery and good governance. Consequent to the merger, the appropriations for Railways will form part of …

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Govt. approves land for Cargo centre at Guwahati airport

The Union Cabinet has approved leasing out of Airports Authority of India (AAI) land measuring 4050 sq. mtrs. to Assam Industrial Development Corporation for Centre for Perishable Cargo at Lokpriya Gopinath Bordoloi International Airport, Guwahati. This will be utilised for setting up of Centre for Perishable Cargo (CPC) and its future expansion at Lokpriya Gopinath Bordoloi International Airport (LGBI Airport), Guwahati. The land is to be leased by AAI on a token licence fee of Rs.1/- per annum for a period of seven years subject to signing of Lease Agreement. After expiry of initial period of seven years, the future lease period will be made afresh as per AAI policy in-vogue. North Eastern Region (NER) in India is rich in flora and fauna. Revenue from export of agriculture and horticulture items will improve economic conditions of NER. There is a need for promotions of perishable cargo export from this region, which will generate employment opportunities directly or indirectly. Facilities for air upliftment of perishable cargo from Guwahati are required to be more effective. Therefore, it has been decided to lease land measuring 4050 sq. Mtrs. to AIDC, by AAI for setting up of CPC and its future expansion at LGBI Airport, Guwahati.

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India & Qatar strengthen cooperation in Tourism

The Union Cabinet has given its approval for signing of a Memorandum of Understanding (MoU) between India and Qatar for strengthening cooperation in the field of Tourism. The main objectives of the MoU are to create favourable conditions for long-term co-operation in tourism, exchange expertise, publications, information/data and statistics related to tourism, encourage cooperation through the exchange of programmes, propaganda and marketing of their tourism products via media etc. The MoU also entails exchange visits of tour operators and media for promotion of two way tourism. It will also encourage co-operation between tourism sectors, tour operators, travel agents and other tourism private sector’s firms and bureaus in the two countries. Qatar is an emerging tourism source markets for India (India received approximately 6313 tourists from Qatar in 2015). Qatar is a potential market for India in terms of Medical tourism and provides vast opportunity for India in this field. The signing of MoU with Qatar will be instrumental in increasing arrival from this emerging source market.

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India, Singapore to sign civil aviation MoU

The Union Cabinet has approved a Memorandum of Understanding (MoU) between India and Singapore in order to improve cooperation in the field of civil aviation. A recent statement released by the cabinet, said, “The Union Cabinet, headed by the Prime Minister, Narendra Modi, has given its ex-post facto approval for signing a (MoU), which was signed in November 2015 between Airports Authority of India (AAI) and Singapore Cooperation Enterprise in Civil Aviation during Modi’s visit to Singapore. The objective of this MoU is to establish mutual cooperation in the field of civil aviation, which will cover, to begin with, the airports of Jaipur and Ahmedabad. This cooperation will be extended to other airports with mutual consent.” The salient features of the MoU include collaboration in Civil Aviation Sector in the areas of Master-planning and design, traffic development, commercial development, service quality improvement, training and development, cargo handling and management, maintenance, repair and overhaul, operation and management and any other areas with mutual consent. To ensure high standards of service at Ahmedabad and Jaipur airports, AAI may enter into operation and maintenance (O&M) contracts, either with or without the responsibility of maximisation of non-aeronautical revenue in the terminal building (excluding land on city side and air side). The city side and airside will continue to be managed directly by AAI. Globally, limited O&M contract models are prevalent for the entire airport operations. AAI has no previous experience in awarding O&M contract model of terminal buildings to other entities. In order to implement the decision, it was necessary to ensure that a suitable entity be engaged for undertaking the O&M contract at Ahmedabad and Jaipur airports.

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