The Telangana State Government is reworking agreements with banks and financial institutions, on repayment of debt and interest, after two years, i.e, when its term ends in 2019.

The Government, over the past two years, has been tied up, in partnership with various banks and financial institutions, to secure loans for Mission Bhagiratha, 2BHK Housing Scheme, Urban Infrastructure projects etc.

The Government, earlier, entered into agreements with banks to repay the principal and interest on loans in installments, every quarter, from the very first year of disbursal of the loan.

However, the Government is now looking to revamp these agreements, further urging the banks to impose a halt, since the day of disbursal of loans for repayment. Recently, this clause was included in the loans secured for Mission Bhagiratha. The same is sought for other loans.

This implies, that the Government would start repayment in 2019, when its term will come to an end. And any Government, that assumes office, after the 2019 elections, would have to face the repayment in its first year.

The Government, last year, had spent over Rs 6,000 crore, to service loans. This year, the figure has increased to Rs 10,000.

The sources in the finance department, said, “Since Assembly elections are just two years away, the government wants to reduce the burden of the debt, by postponing, repayment by two years. This is to ensure, that there are no major financial limitations, to implement welfare and populist schemes in the last two years of its term.”

By Supraja