J&K government has decided to raise Rs 2000 crore from the market to fund projects languishing from 5 to 25 years in the UT.
A senior finance department official informed that the J&K Infrastructure Development Finance Corporation (JKIDFC) has been given the nod to borrow the sum. The JKIDFC was established on September 5, 2018 to give fillip to the development activities in J&K.
Meanwhile, JKIDFC has invited expressions of interest (EOI) from reputed banks and financial institutions registered with RBI for lending to the J&K government at 8.5% interest. “JKIDFC is a registered corporation mandated to raise Rs 8000 from the market for funding languishing projects. The corporation has already raised Rs 1000 crore from J&K Bank which has been exhausted on 1188 works initiated by it,” the official said.
“The bidders are to quote the rate of interest at which they will offer the debt/loan along with the amount they are prepared to invest during January-March 2020-21 and April -May 2021-22,” the EOI issued by the JKIDFC reads.
According to EOI, the loan to be raised is guaranteed by dedicated revenue streams viz. revision of taxes under J&K Motor Spirit and Diesel Oil (Taxation of Sales) Act; increase in one time road tax for motor vehicles; bringing about efficiency in collection of water connection charges; and increasing revenue realization by making full use of permissible limit of 80 lakh cft of extraction of timber.