HYDERABAD: The state government has announced that it is taking steps to reduce the debt burden of the Kaleshwaram Irrigation Project Corporation Limited (KIPCL), taken for the construction of the Kaleshwaram Lift Irrigation Scheme (KLIS) by the then BRS government.
It sent proposals to the Union government, requesting the KIPCL loans be transferred to a Non-Banking Financial Corporation (NBFC).
The KIPCL took loans of Rs 87,449 crore from various banks at high interest rates to fund the previous BRS government’s flagship project, KLIP. By transferring the loans to the NBFC, the state government hopes to secure better terms and lower interest rates, easing the financial burden on the state.
Sources in the Finance department indicated that the NBFC may reduce the interest rate from an existing 9 to 10.5% to a much lower rate of interest. “The state government is planning to clear the debt within four years by increasing the EMI amounts and lowering the interest burden on it,” the sources said.
They added that the Congress government hopes that this move will allow the reduction of around Rs 1 lakh crore so that the political narratives of the BRS are countered.
Recently, the pink party accused the state government of taking up to Rs 1 lakh crore loan. Countering these allegations, the state government argued that the state had to borrow the money to repay the long-pending debts.
Chief Minister A Revanth Reddy has repeatedly been saying the state had to pay around Rs 6,500 crore towards loan repayment every month, attributing this to delay in the implementation of the welfare schemes.