New Delhi: In a major austerity drive from Oct 1, 2004 to save Rs 2000 crore annually, Government has decided to ban purchase of new vehicles, restrict foreign travel only to unavoidable official engagements and effect a mandatory 10 per cent cut in non-plan and non-salary expenditure.

A Government order on a 20-point austerity drive said there would be a total ban on foreign travel for study tours, seminars and workshops funded by the Centre.

However, foreign travel for participating in annual and other formal meetings of bilateral and multilateral bodies and joint commissions would be allowed by restricting the size of the official delegation to bare minimum.

Purchase of all new vehicles by the Government would be banned until further orders. Exceptions would be allowed only for meeting the operational requirements of Defence and Central para-military force, an official release today (Sep 28, 2004) quoting the Government order issued on Sep 24, 2004.

New vehicles will not be purchased even as replacement for condemned ones. Hiring of private vehicles from outside would be limited to the number of those condemned, it said.

The 25 per cent reduction in foreign travel allowances per day for all categories of employees would continue.

All profit-making PSUs will have to declare a minimum dividend of 20 per cent on equity or a dividend payout of 20 per cent on net profit, whichever is higher, the release said.

Oil, petroleum, chemicals and other infrastructure sectors would have to declare a dividend of 30 per cent on their net profits, while joint venture companies would have to make concerted efforts to give 20 per cent dividend on Government holding.

All profitable PSUs would also have to consider issue of bonus shares to Government, it said.

There would be no fresh financial commitments on items not included in the budget and pending review and no funds would be released to autonomous bodies having substantial unutilised balances at their disposal.

There would a graded 5 per cent deduction annually in each successive years on 100 per cent deficit grants given to autonomous bodies.