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Monday, August 8, 2022

State guarantees to corporations, PSEs totals ₹1.67 lakh crore  – Mrit News

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The State government has given guarantees in excess of ₹1.67 lakh crore in the last seven years towards loans drawn by State-owned corporations and public sector undertakings from public sector banks.

The guarantees which started with ₹100 crore in 2014-15, the year of State formation, grew significantly over the years barring 2018-19. Guarantees given to loans taken by corporations and public sector undertakings during 2015-16 were ₹1,830 crore and ₹24,820 crore and ₹22,689 crore in 2016-17 and 2017-18 respectively. The quantum was relatively less the next year 2018-19 at ₹11,927 crore but increased to ₹22,020 crore the next year.

This was followed by ₹48,294 crore in 2020-21 and another ₹35,624 crore in 2021-22 taking the total quantum of guarantees to ₹1.67 lakh crore. Minister of State for Finance Bhagwat Karad released the figures in response to an unstarred question by Congress Member of Parliament from Nalgonda N. Uttam Kumar Reddy in the Lok Sabha.

The Congress MP wanted to know the details of the quantum of guarantees given by the State government towards the loans obtained from public sector banks from 2014 to 2022 year-wise and corporation wise. Capt. Uttam Kumar Reddy wanted to know about the State government guarantees, the amount of money lent to the Kaleshwaram Irrigation Project Corporation Limited by various nationalized banks, and the lending terms, interest rate, moratorium, repayment period and other details.

Dr. Bhagwat Karad said that the PSBs had informed that all term loans were appraised as per the extant RBI guidelines and their board approved policies with respect to technical feasibility, financial/commercial viability and bankability of the project. For infrastructure projects the appraisal would include obtaining techno-economic valuation reports from reputed external experts.

In his written reply, the Union Minister however refused to divulge information sought by the Congress member claiming that the RBI had informed that under the provisions of Section 45E of the RBI Act, 1934, it was prohibited from disclosing borrower-wise credit information.

Section 45E provided that credit information submitted by a bank should be treated as confidential and not be published or otherwise disclosed.

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