The State government has cleared the proposal of Kaleshwaram Irrigation Project Corporation (KIPC) Limited, the entity floated by Telangana in October 2015 for the execution of the major lift irrigation project and to raise a term loan of ₹7,400 crore from the consortium of 10 nationalised banks led by Andhra Bank.
All the participating banks in the consortium sanctioned their share of term loan totalling to ₹7,400 crore recently. The loan amount includes the component of interest during the construction of the project.
“The amount will be utilised for constructing the link-one of the project, from Medigadda barrage across the Godavari to Yellampally barrage. The total cost for the link-one is ₹17,500 crore,” officials in the Irrigation Department said. Apart from extending an “unconditional and irrevocable” guarantee for the repayment of principal and interest of the loan being raised, the State government would also arrange ₹1,850 crore as margin money through budgetary support, taking the cost of work to be executed with the loan from the consortium of banks to ₹9,250 crore.
The KIPC Ltd was constituted to “plan, appraise, approve, release funds, implement, manage, operate, monitor and evaluate the Kaleshwaram Project”. The other banks participating in the consortium are Canara Bank, Corporation Bank, Oriental Bank of Commerce, Indian Bank, Vijaya Bank, Punjab & Sind Bank, Dena Bank, Union Bank of India and United Bank of India. The loan would be repaid by the KIPC in 48 quarterly instalments commencing from June 30, 2020. The repayment would be over with the instalment to be paid in the last quarter of 2031-32 financial year. Officials said that the consortium would release the loan amount once it receives the margin money component from the State government. While Andhra Bank sanctioned loan on February 4, the remaining banks in the consortium sanctioned their share of the loan on February 9.
