The State government has successfully mobilised ₹2,000 crore from the Reserve Bank of India during the auction conducted by the Apex Bank on Tuesday.
With this, the State had completed mobilising ₹6,000 crore from the RBI in three tranches since April this year. The amount entailed an interest of 8.05%, a shade lower than 8.15% of the previous tranche of the State Development Loan and the tenure of the loan is 25 years. Officials told The Hindu that the proceeding was well within the norms of the Fiscal Responsibility and Budget Management Act.
Added cushion
The amount, according to sources, had been mobilised as a cushion to avoid shortfall of cash for the implementation of the Rythu Bandhu scheme, slated for launch on May 10. Though the State was not facing any financial constraints, it had opted for mobilising the funds as they would serve as cushion without impacting the implementation of other welfare and developmental programmes.
The government had so far positioned ₹4,114 crore for meeting the requirements under the Rythu Bandhu scheme and the amount mobilised on Tuesday would take the entire quantum to ₹6,114 crore. The government has pegged the requirement for the first phase of Rythu Bandhu scheme at ₹5,608 crore of which, the requirement of cash could be around ₹3,500 crore as a majority of small and marginal farmers who comprise around 85% of the beneficiaries could opt for cash withdrawals. The balance 15% of farmers with medium to large holdings are expected to prefer transfer of money into their accounts.
Give it up
The government had also decided against insisting on farmers with sound economic backing to give up the incentive as it was felt that such insistence would give scope for criticism by the Opposition parties. Accordingly, the government had decided to place forms with ‘give it up’ option at the counters being set up for distribution of cheques to ensure that give it up would be purely voluntary.
