UP govt to depts: Take loans from other public institutions to work on development projects

Industry department's UP Expressway and Industrial Development Authority could take loans worth Rs 3,500 crore for development of expressways.

Written by Lalmani Verma | Lucknow | Published: June 16, 2017 1:38:43 am

THE State government has asked its six key departments to take loans up to Rs 16,580 crore in the current financial year from public sector financial institutions for their projects. This comes amid the government announcing loan waiver for farmers, leading to a shortfall of around Rs 36,000 crore in the state exchequer. Moreover, over Rs 30,000 crore is needed to implement recommendations of the seventh pay commission.

According to the directive issued by the finance department, while public works department’s UP Rajkiya Nirman Nigam may take a maximum loan of Rs 2,600 crore for construction of roads, UP State Highways Authority may borrow Rs 2,500 crore for development and upgradation of highways and UP Bridge Corporation can take loans up to Rs 1,000 crore for building bridges.

Industry department’s UP Expressway and Industrial Development Authority could take loans worth Rs 3,500 crore for development of expressways. The government is at present working on a 354-km Purvanchal expressway project, proposed to connect Lucknow with Ghazipur. On the other hand, both UP Housing Development Board (urban planning department) and State Urban Development Authority (urban employment and poverty alleviation department) can take loans up to Rs 1,000 crore each for development of houses. Moreover, UP Rural Housing Corporation (rural development department) can borrow Rs 3,000 crore for building houses in rural areas.

In the power department, while the UP Power Corporation is allowed to take loans up to Rs 800 crore for upgrading power supply network, UP Transmission Corporation can borrow up to Rs 1,020 crore for strengthening power transmission system and UP Rajya Vidyut Utpadan Nigam may take loans worth Rs 160 crore for developing new power generation.

These department will take loans from HUDCO, NABARD, Rural Electrification Corporation and power finance corporations. When contacted, Finance Minister Rajesh Agarwal said: “Loans will be taken for development works and the state will give the guarantee.”

Claiming that the departments have not been asked to borrow due to the financial burden on the state exchequer, Agarwal said: “The state will earmark funds in the Budget for these departments in the coming financial years so that the loans could be repaid with interest.”

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