Ordinance route reflects the Government's resolve to actualize economic reforms

ASSOCHAM welcomes the promulgation of ordinances to take the economic reform process forward. The two ordinances, enacted to increase FDI limit in the insurance sector to 49% from 26% and enable the coal block auction process, have been big sentiment boosters.

The ordinance route taken for insurance and coal e-auction process would have the following impact on the economy:

Hike in FDI in insurance likely to bring much-needed long term capital to the sector, enabling greater penetration thereby generating an indirect positive effect on infrastructure financing in the country.

The coal auction ordinance overcomes the procedural hurdles of Parliamentary approval to assign coal blocks to successful bidders via an e-auction route in a transparent manner which were earlier cancelled by the Supreme Court sighting discrepancies in the allocation process.

 

Early allocation of coal blocks is critical to bring the power and coal sector out of operational and financial crisis, as any delay could potentially derail the economic recovery process.

This indicates the Government's strong commitment and positive outlook to the business and investor community.

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