The Modi government will write-off ₹20,532.5 crore — the total amount of government loans and interest accrued to three public sector fertiliser companies.

The three public sector fertiliser companies that will benefit from this proposed move are Fertiliser Corporation of India (₹10.643.75 crore as of end March 2012); Hindustan Fertilisers Corporation (₹9,079.48 crore as of end March 2015) and Brahmaputra Valley Fertiliser Corporation (₹809.26 crore as on May 21,2015).

The proposed write-off is reflected in the second batch of Supplementary Demand for Grants for 2017-18 tabled in Lok Sabha by Finance Minister Arun Jaitley on Monday.

Through the second batch of Supplementary Demand for Grants, Jaitley sought Parliamentary approval for an additional spend of ₹66,113.34 crore including net cash outgo of ₹33,379.99 crore.

It may be recalled that Jaitley had moved the first batch of Supplementary Demand for Grants in July this year and sought Parliament approval to make an additional spend of ₹11,166 crore including net cash outgo of ₹10,648 crore.

Cash spends

As part of the second batch of Supplementary Demand for grants, the Centre plans to make cash spend of ₹900 crore towards subsidies under interest equalisation scheme for certain employment intensive sectors to boost exports.

The Centre will also incur cash spend of ₹200 crore for establishing Aadhaar enrolment and updation centres in Post Offices.

Also, an amount of ₹3,080 crore will be spent as subsidy for payment of interest liability in respect of loan granted to Food Corporation of India from National Small Savings Fund (NSSF).

The Agricultural Product Export Development Authority (APEDA) will get ₹87.50 crore for pending liabilities on account of Transport Assistance or infrastructure development.

For the Goods and Services Tax Network (GSTN), the Centre will fork out ₹960 crore towards establishment related expenditure including payment of advance user charges to this network entity.

As much as ₹6,000 crore will go towards payment of increased pension on account of implementation of the 7th Pay Commission recommendations.

The Centre will also spend ₹4,800 crore on the Mahatma Gandhi National Rural Employment Guarantee scheme.

Financial sector

The banking sector is in for some disappointment as the second batch did not reflect the proposed recap bonds that the government was looking to issue in the coming days.

However, there is now an allocation of ₹380 crore as subscription to the share capital of Nabard.

As much as ₹212 crore will be infused in Regional Rural Banks as part of their recapitalisation.

comment COMMENT NOW