The Hindu Business Line : Cabinet authorises release of Rs 500 cr to calamity fund

THE Union Cabinet today authorised the immediate release of Rs 500 crore to the National Calamity Contingency Fund (NCCF), which will go towards financing relief operations in the tsunami-hit States.

The decision was taken at an evening meeting chaired by the Prime Minister, Dr Mammohan Singh, here. The Rs 500-crore relief routed through the NCCF would meet immediate requests from the affected States, the Finance Minister, Mr P. Chidambaram, told presspersons after the Cabinet meeting.

Earlier, speaking to newspersons on the sidelines of the annual general meeting of the Federation of Indian Chambers of Commerce and Industry, the Finance Minister said that he did not foresee any large-scale fiscal impact for the Centre due to the disaster. He also noted that there were no reports of major damages to major ports in Chennai, Tuticorin or Kochi. The Cabinet also endorsed the Prime Minister's announcement of providing an ex-gratia relief of Rs 1 lakh to the family of each of those who were killed.

Meanwhile, a senior Finance Ministry official said that the Union Budget had already provided for a sum of Rs 1,600 crore to be transferred to the NCCF for the current fiscal and "there is no need for any additional impost at this stage".

The Centre currently imposes a national calamity contingency duty on cigarettes, pan masala, biri and other tobacco products, which are budgeted to fetch a total of Rs 2,134 crore during 2004-05.

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Cabinet authorises release of Rs 500 cr to calamity fund