The government has cleared the civil aviation policy and kick-started consolidation among public sector banks. This is for backing SBI’s proposed merger of five SBI associate banks with itself. Also, they approved 10% stake sale in HUDCO in a fresh push to reforms.
The big Cabinet decisions on Wednesday came a day after the government moved decisively on GST, igniting stock markets that celebrated the steps that were widely anticipated after the recent assembly polls and Rajya Sabha elections.
The new aviation policy junks the so-called 5/20 rule and gives a leg up to greater connectivity by providing incentives for flying to cities that are not on the air map.
SBI had sought the government’s nod for merging five associate banks — State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore — and Bharatiya Mahila Bank with itself.
“The government has taken note of the merger proposal,” a senior government official told ET, requesting not to be identified. The proposal does not need to be approved by the Cabinet, he said. The government’s support nonetheless puts the process on fast track, signaling the beginning of the process of consolidation among state-run banks.
10% disinvestment in Housing & Urban Development Corporation Limited (HUDCO) has been approved by The Cabinet Committee on Economic Affairs approved through an initial public offering or IPO.
Airfares to Get Cheaper as New Rule to Replace 5/20; Cabinet Clears Aviation Policy
