New Delhi: A day after the government pledged the partial decontrol of sugar in the next fortnight, the Union cabinet on Thursday approved a set of significant measures aimed at tackling Maoist insurgency and asserting its strategic hold over an area claimed by neighbouring China.
The measures approved involve upgrading rural road connectivity with special emphasis on districts hit by the insurgency and in the strategically located Arunachal Pradesh, bordering China. Most of the north-eastern state is claimed by China as part of a lingering border dispute.
The package worth Rs.38,500 crore will be implemented over the course of the next four-five years, rural development minister Jairam Ramesh told reporters in New Delhi.
The Congress party-led United Progressive Alliance government has unveiled a series of measures since September, ending a prolonged period of policy stasis, as it tries to retrieve its image, which has taken a pounding following several corruption allegations. It faces series of state polls this year, with a general election due to be held in 2014.
The proposal approved by the cabinet is aimed at beefing up security, besides making sure that development reaches neglected parts of the country. Prime Minister Manmohan Singh has identified the Maoist insurgency as India’s greatest internal security challenge.
The plan allows for habitations with 100 or more people in 82 Maoist-affected districts to be linked under the Pradhan Mantri Gram Sadak Yojna (PMGSY), compared with the previous ceiling of 250 people in such areas.
“It has been seen that in many Maoist-affected areas, habitations are small with less than 250 people,” Ramesh said.
Such areas will have multiple-access roads and not just one, a long-standing demand of security forces engaged in anti-Maoist operations across large swathes of the country. The government has earmarked Rs.8,000 crore for this part of the programme, according to a statement from the rural development ministry.
The new proposal will also provide “new connectivity to 126 clusters of habitations of below 250 population in Arunachal Pradesh”, the statement said, adding that Rs.1,200 crore had been earmarked for this part of the programme.
China claims 90,000 sq. km of Indian territory in Arunachal Pradesh; it occupies around 38,000 sq. km in Jammu and Kashmir that India claims.
Besides this, the government is also looking at improving connectivity in other border, hilly and desert areas in states such as Assam, Kashmir, Sikkim and Gujarat, the statement added.
PMGSY was launched in 2000 by the Bharatiya Janata Party-led National Democratic Alliance government with the objective of providing all-weather connectivity to all unconnected habitations with a population of 500 people and above in the plains and 250 persons and above in hilly states, desert areas and tribal-dominated districts.
The decisions came on the day the government’s sale of shares in state-owned NTPC Ltd was oversubscribed. The government sought to raise Rs.11,400 crore from the sale, helping it partially meet the target of Rs.30,000 core from divestments in the current fiscal year. The biggest asset sale this fiscal will see the government’s stake in the country’s No. 1 utility drop to 75% from 84.5%.
The move on sugar decontrol comes as the government has already decided to remove curbs on exports of the commodity from India, allowing producers to benefit from higher prices in overseas markets.
“The decision on decontrolling levy sugar and release mechanism system will definitely be taken before budget,” K.V. Thomas, minister of state for food and consumer affairs, told PTI on Wednesday.
“A CCEA (cabinet committee on economic affairs) note will be moved after consulting senior ministers, especially the agriculture and defence ministers, in the next two days. We need to discuss how we can manage if levy sugar obligation is removed,” Thomas said.
Mint reported the draft findings of the committee on sugar decontrol on 4 January 2011.
Such a move could, however, provoke a political backlash. Though pro-industry, deregulation could make sugar cane farmers vulnerable to global and domestic commodity price cycles. India, the biggest consumer and second biggest producer of the sweetener, controls the industry through procurement prices set by both the Centre and states, besides a monthly release mechanism that keeps prices stable.
Ten per cent of sugar is routed to the poor through the public distribution system at lower prices, the cost of which is borne by the industry.
In other decisions on Thursday, the Union cabinet approved the extension of the rural roads programme and the formation of a special purpose vehicle (SPV) for the gas pipeline project from Turkmenistan to India through Afghanistan and Pakistan, known as TAPI. It also allowed state-owned GAIL (India) Ltd to join the SPV, TAPI Ltd, on India’s behalf, which will have representative companies from the partner countries of Turkmenistan, Afghanistan and Pakistan.
This SPV will seek an anchor investor to share the $9 billion (around Rs.47,700 crore) risk for the 1,680km pipeline project, a search that has thus far remained elusive. While potential anchor investors have made their participation conditional to energy-rich Turkmenistan offering them stakes in its hydrocarbon fields, the Central Asian nation doesn’t allow such ownership rights and only offers service contracts.
The SPV will require an initial investment of $20 million, with the participating entities contributing $5 million each. The Asian Development Bank is the lead partner in the pipeline project, also dubbed as the peace pipeline for bringing together nations that share complex and difficult relationships.
CCEA on Thursday also cleared three Indian Railways projects. Rail links approved for construction include the 121km Gevra Road-Pendra Road and the 63km Raigarh (Mand Collieries)-Bhupdeopur stretches in Chhattisgarh. It also approved the doubling of the 247km broad-gauge line between Palanpur and Samakhiali in the Kutch region of Gujarat.
CCEA also approved the minimum support price (MSP) for copra and the merger of the National Lake Conservation Plan and the National Wetlands Conservation Programme into a new scheme known as the National Plan for Conservation of Aquatic Eco-systems to avoid overlap. The MSP for milling copra and ball copra was set at Rs.5,250 per quintal and Rs.5,500 per quintal, respectively.
Neha Sethi and PTI contributed to this story.