The Cabinet on Thursday approved a slew of proposals, including a Rs 1,650-crore investment by Germany’s Dailmer AG on its proposed joint venture with India’s Hero Group to manufacture commercial vehicles over 2 tonne. Daimler’s investment will constitute 60% of the equity capital of the JV, an official spokesperson said.

The JV will design, manufacture and sell in India and overseas and would also source components from India for Daimler’s global requirements, besides undertaking research and development activity for new products and variants.

The Union Cabinet also approved setting up a Farmers’ Debt Relief Fund with an initial corpus of Rs 10,000 crore to implement the farm loan waiver scheme announced in the Union Budget to help around four crore farmers. The government will initially provide Rs 10,000 crore to the Fund, which has been earmarked in the supplementary demands for grants for 2007-08.

The fund, according to the decision made by the Union Cabinet, would be augmented by another Rs 50,314 crore in the next four years to compensate the banks and other lending institutions on account of losses resulting from farm loan waiver scheme.

In addition to Rs 10,000 crore that has been earmarked in 2007-08 for funding the scheme, the government will provide Rs 15,000 crore each in 2008-09 and 2009-10, Rs 12,000 crore in 2010-11 and Rs 8,314 crore in 2011-12.

Another decision taken by the Cabinet refers to the transfer of Rs 6,000 crore from the exchequer this year to a dedicated fund to implement various social and infrastructure development initiatives taken by it.

The initiatives include upgradation of 1,396 ITIs, training to farmers, providing insurance cover to rural landless households, means-cum-merit scholarships, ground water recharge and employment for physically-challenged.

The Cabinet Committee on Economic Affairs approved the continuation of the ‘Social and Infrastructure Development Fund’ beyond 2007-08 for implementing these initiatives, an official spokesperson said.

In another decision, the Union Cabinet approved an increase in the block grant for the seven IITs and Indian Institute of Science at Bangalore from this year over and above the 2005 level. The Cabinet also gave its approval for undertaking of comprehensive exercise ahead of time to revise the block grant scheme in a rational manner, she said. The decision would help in restoring the financial health of IITs and IISc, she added.

The Cabinet also approved expenditure of over Rs 257 crore to upgrade and renovate several venues forCommonwealth Games.

Aiming at improving the livelihood of minorities, Government today approved an expenditure of Rs 3,780 crore in 90 minority-dominated districts across the country to implement various developmental schemes in the course of the 11th Plan.