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Cabinet defers pension bill due to opposition from Trinamool

The decision to defer the controversial bill assumes significance as the UPA government would not like to ruffle the feathers of Trinamool Congress ahead of the Presidential elections
 

New Delhi: With Trinamool Congress, the key alley in the united progressive alliance (UPA) coalition raising the banner of opposition to the pension reform bill, the government on Thursday played safe by deferring the legislation, apparently keeping in view the upcoming Presidential polls, reports PTI.

The Union Cabinet was to take up the Pension Fund Regulatory and Development Authority (PFRDA) Bill, 2011, which provides for private sector and foreign investment in pension sector, but put it off without any consideration, sources said.

The decision comes in the wake of Trinamool Congress member and Railway Minister Mukul Roy writing to Prime Minister Manmohan Singh and Finance Minister Pranab Mukherjee yesterday, saying that more discussions were needed on the bill, sources said.

Roy told Singh and Mukherjee that his party's view on the bill was not articulated as it has no member in the Parliamentary Standing Committee on Finance which has considered the legislation. Subsequently, the decision to defer the bill was taken last night.

The decision to defer the controversial bill assumes significance as the government would not like to ruffle the feathers of Trinamool Congress ahead of the Presidential elections.

The Cabinet, as per the agenda, was scheduled to approve changes in the PFRDA Bill in light of the recommendations of the Standing Committee on Finance, to pave way for passage of the bill in Monsoon session of Parliament next month.

The Cabinet, sources said, was required to take a view on the proposal of ensuring assured returns to pension fund subscribers, as suggested by the Committee, headed by senior Bharatiya Janata Party leader Yashwant Sinha.

The PFRDA Bill, which has been pending for several years, seeks to open the pension sector to private sector and foreign investment.

The proposed legislation was introduced in the Lok Sabha or the Lower House of Indian Parliament on 24 March 2011.

The PFRDA Bill provides for establishment of a statutory authority to undertake promotional, developmental and regulatory functions in respect to pension funds.

Interim PFRDA is functioning since 2003 through an executive order.

PFRDA, set up as a regulatory body for pension sector, is yet to get statutory powers as the Bill pertaining to that effect lapsed in Parliament with the expiry of last Lok Sabha in 2009.

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Cabinet approves Rs632 crore capital infusion in regional rural banks

Cabinet approved the release of 50% share of the central government for recapitalisation of the remaining 24 RRBs to improve their capital to risk weighted assets ratio
 

New Delhi: The Indian government on Thursday approved Rs632 crore capital infusion in cash-starved regional rural banks (RRBs) to improve their capital adequacy and lending capacity to the agriculture sector, reports PTI.

"RRBs will get Rs632 crore from the central government", said a minister after the meeting of the Cabinet.

Following recommendations of Reserve Bank of India (RBI) deputy governor Dr KC Chakrabarty, the government had initiated recapitalisation process in 2009-10 for 40 financially weak RRBs, which mainly provide credit to rural and agriculture sectors.

However, till March 2012, capitalisation was done in 16 banks as several states did not provide their contribution.

In order to complete the process of recapitalisation, the Cabinet has decided to extend the scheme by two years.

"The Union Cabinet today approved the release of 50% share of the central government for recapitalisation of the remaining RRBs to improve their capital to risk weighted assets ratio (CRAR)," an official statement said.

"The release of central government share is subject to the release of state government and sponsor bank share," it added.

The capital of RRBs is shared by centre, states and the sponsor bank in the ratio of 50%, 15% and 35% respectively.

Hence, in essence, these 16 RRBs would get Rs1,264 crore of fresh capital if all stakeholders contribute in proportion to their shares for recapitalisation.

India has 82 RRBs and almost all of them are equipped with core banking solutions.

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COMMENTS

ganesh chandra

5 years ago

Finally some required tough decisions taken by government which all citizens were wanting.... we should not allow any government body/ appointments/ organisations being paid by for by tax-payers money be taken for a RIDE and exploit Aam Junta or the elected government itself..

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