Cabinet today approved a new policy for acquisition of raw material assets from abroad by central Public Sector Enterprises having a three year record of profit. Information and Broadcasting Minister Ambika Soni said after the cabinet meeting that the policy will pave the way for Navratna firms to invest up to 3,000 crore rupees in such assets without government approval. The present limit is 1,000 crore rupees. She said that the policy will facilitate the acquisition of coal, iron ore and other assets abroad. Mrs Soni said that a Committee of Secretaries Headed by the Cabinet secretary is being set up to examine proposals having enhanced financial implications or where Government funding is involved.

Mrs. Soni said that the Committee will facilitate quick and coordinated decision-making, coordinate the grant of concessional credit to foreign enterprises, recommend government funding and decide about the nature of such funding on a case-to-case basis.

In another decision cabinet approved amendments to Laws to enable banks to effectively deal with the menace of bad loans besides encouraging them to disburse credit freely to home and corporate loan seekers. Mrs Soni said that the Cabinet also approved the introduction of the enforcement of Security Interests Act and Recovery of Debts Laws Bill for introduction in the Winter Session of Parliament for the purpose.

Mrs Soni said Cabinet also gave its nod to bring Infrastructure Finance Company Limited under Regulatory Oversight of Reserve Bank of India. This, she said, will increase the authorise capital of the Company from 2000 to 5000 crore rupees. The amount can be increased to 8000 crore rupees with the approval of the Finance Minister.

In another decision, the Government also approved more devolution of powers to panchayats in the management of National Rural Drinking Water Programme, NRDWP and carving out of a special fund to monitor quality of drinking water. It also gave the nod for creation of a component of Water Quality Monitoring and Surveillance and allocated three per cent of NRDWP funds for this purpose. However, the allocation of funds for natural calamities has been reduced from 5 per cent to 2 per cent.