Nod for Cairn-Vedanta deal good signal to investors: Pranab

Finance Minister Pranab Mukherjee today said the government's decision to clear the long pending USD 9.6 billion Cairn-Vedanta deal will send good signals to foreign investors.

Mukherjee said the Cabinet cleared the recommendations on the deal given by a ministerial panel headed by him and the decision would "create appropriate sentiments in the market".

He said this while talking to reporters after meeting of the Cabinet Committee on Economic Affairs (CCEA) which cleared the deal.

More than 10 months after the deal was first struck, CCEA headed by Prime Minister Manmohan Singh, gave approval to Cairn Energy for selling its Indian unit to Vedanta Resources, subject to the new owner agreeing to share royalty and pay oil cess on mainstay Rajasthan oilfields.

The GoM had recommended to the Cabinet that the deal be approved if Cairn or its successor agreeing to adding royalty to the project cost and recovered from oil sales besides agreeing to pay its share of Rs 2,500 per ton oil cess.