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Home / Politics / Policy /  Cabinet clears sale of 10% stake in state-owned Hudco

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved the sale of a 10% stake in state-owned Housing and Urban Development Corp. Ltd (Hudco) through an initial public offering.

Hudco’s paid-up equity capital stands at 2,001.90 crore and its net worth is around 7,800 crore. Hudco was set up in 1970 as a wholly-owned government company under the administrative control of the ministry of housing and urban poverty alleviation with the objective of providing long-term finance for construction of houses.

It also finances and undertakes housing and urban development projects in the country.

The central government has set a disinvestment target of 56,500 crore for 2016-17. Of this, 36,000 crore is expected to come from minority stake sales and 20,500 crore from strategic stake sales.

The government has already initiated the disinvestment programme for the current fiscal with a stake sale in NHPC Ltd that fetched it 2,700 crore.

It plans to sell stakes in an additional 15 state-controlled units, including Coal India Ltd, National Fertilizers Ltd, Bharat Electronics Ltd, in the year to 31 March.

During 2015-16, the government managed to generate 25,312 crore through stake sales in state-run units, less than half the target of 69,500 crore.

The cabinet also approved raising the retirement age of Central Health Services employees from 62 to 65 years to reduce the shortage of doctors for implementing national health programmes.

India’s public health system faces an acute shortage of doctors with only one doctor available for every 1,700 people, as against the World Health Organization requirement of one doctor for 1,000 people.

Prime Minister Narendra Modi had on 31 May approved the health ministry proposal to raise the retirement age of doctors. The Central Health Service staff includes non-teaching staff, public health specialists and general duty medical officers working under the central government.

Attempts by the government to improve public health services through other means have faced resistance. Medical students had earlier opposed a government move to make it mandatory for them to serve two years in a rural public health facility before applying for postgraduate courses.

Health minister J.P. Nadda had earlier said that the move will strengthen the healthcare sector and help the government roll out its people-oriented schemes.

Among other decisions, CCEA approved the widening of the Kharar-Ludhiana section of National Highway 95 in Punjab at a cost of 2,069 crore.

The cabinet gave its nod to the signing of a 15-year contract between the ministry of earth sciences and the International Seabed Authority (ISA) for undertaking exploration and other development activities related to polymetallic sulphides in the allotted area of 10,000 sq. km in the Indian Ocean.

Polymetallic sulphides contain iron, copper, zinc, silver, gold and platinum.

ISA, under the United Nations Convention on Law of the Sea, governs non-living resources lying in international waters.

“By signing the 15-year contract, India’s exclusive rights for exploration of polymetallic sulphides in the allotted area in the Central Indian Ridge, and South West Indian Ridge in the Indian Ocean will be formalized. It will enhance India’s presence in the Indian Ocean where other players like China, Korea and Germany are active," explained the official statement.

The cabinet also approved India’s membership of the International Continental Scientific Drilling Program (ICDP) consortium by signing an agreement with the Helmholtz Centre Potsdam GFZ German Research Centre for Geosciences.

“As a member of ICDP, scientists/engineers from India would have the right to submit proposals, to participate in all ICDP co-funded workshops and drilling projects and have access to all data results from ICDP projects. This will shed new light on the genesis of seismicity and better understanding of earthquake processes," a statement said.

In addition, the cabinet cleared the signing of an air services agreement between India-Taipei Association in Taipei (India’s representative office in Taiwan) and Taipei Economic and Cultural Center in India (Taiwan’s representative office in India). The government believes the agreement has the potential to spur greater trade, investment, tourism and cultural exchanges between the two parties.

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