The Cabinet Committee on Economic Affairs (CCEA) on Thursday cleared two of the 15 odd items that figured on it’s agenda. One of the two items that were cleared was the expansion of liquid steel capacity from 3 million tonnes to 6.3 million tonnes in Rashtriya Ispat Nigam Ltd, better known as Vizag Steel. The project that was estimated to cost Rs 8,277 crore originally, will now cost Rs 8,692 crore as per June 2005 revised prices. Debt equity ratio for the Vizag Steel expansion project will be 1:1. The equity component will be funded internally for the project, which is expected to be complete by 2007-08. CCEA also approved the procedure for approval of Public-private partnership (PPP) projects. This had earlier been discussed and approved by the Cabinet Committee on Infrastructure. As per the Cabinet approval, a PPP Advisory Committee will rate projects before competitive bidding is invited for their implementation. The committee will have the secretaries from the Department of Economic Affairs, Expenditure, Planning Commission, Legal Affairs and the secretary of the department concerned with the project. PPP projects, where the capital costs are below Rs 100 crore, would not need to get a clearance from the appraisal committee.However, the CCEA deferred the proposed Rs 10,000 crore Special Purpose Vehicle (SPV) for funding infrastructure projects. On SPV, Chidambaram said that the decision was deferred till next meeting. The National Export Insurance Account, mooted in the Budget 2005-06, too had to be deferred as the proposal has to be redrafted.
