The Union Cabinet, on Tuesday, is likely to take up the National Manufacturing Policy, which aims at developing mega industrial zones with flexible labour and environmental laws. According to sources in the Department of Industrial Policy and Promotion, all issues related to labour and environment ministries have been resolved by a Group of Ministers (GoM) set up for the manufacturing policy and it “is likely to come in Cabinet tomorrow”. Earlier last month, the ministries of environment and labour were opposed to the proposals brought in by the Commerce and Industry Ministry. To resolve the differences, Prime Minister Manmohan Singh had formed the GoM headed by Agriculture Minister Sharad Pawar, which successfully resolved the contentions at its very first meeting. According to the draft policy, a special purpose vehicle, to be headed by a CEO, will oversee the proposed National Manufacturing Investment Zones (NMIZs). However, the proposal ran into hurdles over concerns that states may have problem with this arrangement. The NMIZs, to be developed with private sector participation, would have facilities like industrial towns and other infrastructure, like the ones set up in China, a global manufacturing hub. The other proposal to come before the Cabinet is interest subvention on home loans. The finance ministry has proposed a subvention of 1 per cent on home loans up to Rs 15 lakh, with the cost of the house not exceeding Rs 25 lakh. The move comes after the UPA government’s decision to classify such loans as priority-sector advances. The last Budget had classified housing loans of up to Rs 20 lakh as priority sector advances. According to government sources, about 30 per cent of the total home loans taken, fall within this bracket. The scheme has been mooted as an incentive for poor and middle class families to enable them buy a house in a high-interest rate environment, where the rates on home loans are ranging between 10-15 per cent. The interest subvention, however, will not be applicable to existing home loans. This proposal is being seen as a relief measure for home loan borrowers from the low income group and also to give a fillip to the low-cost housing segment in rural areas where the demand for such housing is high. The Cabinet would also decide on the new Companies Bill 2011, which has been drafted in the wake of the accounting malpractices at Satyam. The Bill promises greater shareholder democracy and stricter corporate governance norms and has introduced ideas like corporate social responsibility, class action suits and a fixed term for independent directors. It also provides for stricter safeguards for raising money from the public and prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence. Another important proposal to be likely considered by the Cabinet is to increase India’s contributory quota in the International Monetary Fund (IMF). The Cabinet would consider the amount of monetary support that would be enhanced in view of the nation’s growing clout as the world’s second fastest growing economy. The country’s apex decision-making body would also decide on a proposal on the need for infusing Rs 3,000 crore as equity for strengthening the capital base of NABARD for enhancing credit flows to the farm sector.