Cabinet nod for RBI to sack bank boards

11 Bills cleared for introduction in this session.

The Cabinet today approved the introduction of 11 Bills in Parliament during the current session. These include the Bill for amending the Banking Regulation Act, 1949, which will empower the Reserve Bank of India (RBI) to supersede the board of a banking company.

The amendment will also empower the RBI to direct banking companies to furnish financial statements and disclose business affairs of their associate companies so that these can be inspected.

In another Bill aimed at amending the RBI Act, 1934, the Cabinet today sought to give the RBI greater operational flexibility while setting the cash reserve ratio for banks.

In an attempt to improve the quality of credit appraisal, the government also decided to amend the Credit Information Companies (Regulation) Bill, 2004. The amendment will facilitate the setting up of credit information companies for collection, sharing and dissemination of credit information.

The Cabinet today also approved the long-awaited Special Economic Zone Bill, 2005, whereby units within the zones will be eligible for 100 per cent tax exemption for the first five years and 50 per cent for the next five.

The commerce ministry's recent proposal to abolish the cess on exports of agricultural products has also been approved with the Cabinet decision to repeal and amend the various laws.

Briefing mediapersons at the conclusion of the Cabinet meeting, Information and Broadcasting Minister Jaipal Reddy said the Taxation Laws Amendment Bill, 2005, was cleared to take care of the non-fiscal measures proposed by the government.

In order to enhance the competitiveness of small and medium enterprises and facilitate their development, the Cabinet decided to enact the Small and Medium Enterprises Development (SMED) Bill, 2005.

Other Bills cleared by the Cabinet today include the enactment of a law on disaster management, the repeal of the Freedom of Information Act, 2002, and legislation of the Right to Information Act, 2004.

The Disaster Management Bill, 2005, will enable the government to set up a national disaster management authority chaired by the prime minister.

The Cabinet also approved the revival package worth Rs 73.3 crore for Hindustan Salts Ltd.