Cabinet okays loan of Rs 822 cr with interest of 8.90 pc to CSMC

The demand for an interest free loan was set aside. CSMC will have to repay the loan with EMI of Rs 17 crore.

Lokmat News Network

Chhatrapati Sambhajinagar:

To quench the city's thirst, a new water supply scheme worth ₹2,740 crore is being implemented. Under this scheme, the Chhatrapati Sambhajinagar Municipal Corporation (CSMC) is required to contribute ₹822 crore as its share. However, the corporation lacks such a large amount. For the past few years, the corporation had been attempting to obtain this amount as an interest-free loan, but with no success.

On Tuesday, during a state cabinet meeting, a loan of ₹822 crore was finally approved for the CSMC. This loan will be provided through Housing and Urban Development Corporation (Hudco) at an interest rate of 8.90 per cent. The monthly repayment (EMI) for this loan is estimated to be around ₹17 to ₹18 crore, which also poses a financial burden on the corporation.

In the ₹2,740 crore water scheme, the Central Government will contribute 25% (₹685.19 crore); State Government 45% (₹1,233.34 crore) and CSMC 30% (₹822.22 crore). The project work began before the COVID-19 pandemic, but the municipal corporation had not contributed its share due to financial constraints.

Despite persistent efforts over the last two years to secure an interest-free loan, the proposal was not successful. Eventually, the State Government, in its cabinet meeting, approved the ₹822.22 crore loan from HUDCO at 8.90% interest.

Funding received so far (in Crores):

Contributor Total Share Funds Received Pending Amount

Central Govt/₹685 Cr/₹646 Cr/₹39 Cr

State Govt/₹1,233 Cr/₹1,161 Cr/₹72 Cr

Municipal Corp/₹822 Cr/₹00 Cr/₹822 Cr