Telangana govt to avail loans from global banks
The state government has began an exercise to go in for fresh borrowings from external financial institutions- mainly international agencies for the two prestigious programmes - construction of irrigation projects and double bed room housing scheme, taken up at the cost of nearly Rs 30,000 crore in 2016-17.
Hyderabad: The state government has began an exercise to go in for fresh borrowings from external financial institutions- mainly international agencies for the two prestigious programmes - construction of irrigation projects and double bed room housing scheme, taken up at the cost of nearly Rs 30,000 crore in 2016-17.
The government has earmarked Rs 25,000 crore for irrigation alone in the new financial year. Though no specific allocations were made in the budget, the government had first said that it was planning to spend nearly Rs 10,000 crore on housing scheme by mobilising funds from banks including HUDCO this year.
The officials of the state Finance department now say that the government has identified some international financial institutions to avail loans for the two prestigious programmes. The first choice before the government is the New Development Bank BRICS (Brazil, Russia, India, China, South Africa) head quartered in Shanghai, China.
Officials said that government already forwarded proposals to BRICS bank through the union government seeking nearly Rs 60,000 crore for infrastructure development projects like- elevated highways, multi-storied buildings and sewage and drinking water supply projects in GHMC and HMDA (Hyderabad Metro Development Authority ) recently.
Another proposal seeking funds for irrigation and housing schemes is under preparation. Since the issue was in the preliminary stage, officials said the details of the extent of loan amount to be sought from the bank would be finalized by the Chief Minister K Chandrasekhar Rao.
The possibility of seeking funds from World Bank and Asian Development Bank (ADB) is also under consideration. “We have many options to seek loans from domestic and international financial agencies. The major issue before the government is to get loans at cheaper interest rates to avoid further financial burden in the future”, officials said. 3
It may be mentioned here that the CAG pulled up the Telangana government for the high rate of debt burden in the last two years. The outstanding debt that was Rs 83,845.78 crore in 2014-15 has gone up to Rs 1,23,821.49 crore in 2016-17. Of this the highest increase has been from open market loans which have gone up by about 60 percent.
In 2014-15, the open market loans were Rs 56,399.96 crore. It has now gone up to Rs 93,284.40 crore. As major chunk of revenues are being utilized for the welfare and other developmental programmes, government found borrowings from the agencies would only help to meet the financial requirement, officials maintained.