Telangana government to mortgage Kokapet and Raidurg lands to raise 10,000 crore loan
In order to raise funds to the tune of Rs. 10,000 crore, the Telangana government has sought an approval from the RBI to mortgage 400 acres of TGIIC lands in Kokapet and Raidurg
Hyderabad: Continuing its borrowing spree, the Telangana government sought approvals from the Reserve Bank of India (RBI) to mortgage 400 acres of prime land owned by the Telangana Industrial Infrastructure Corporation (TGIIC) in Kokapet and Raidurg and raise Rs 10,000 crore from banks. While around Rs 8,000 crore are required to disburse Rythu Bandhu financial assistance to farmers for Yasangi (Rabi) season, the remaining Rs 2,000 are proposed to settle dues for retired government employees.
According to sources, a couple of banks evinced interest to lend the huge loan. The land audit has been completed and documents were sent to the RBI for final approval. Once cleared, the funds will be credited to the State treasury.
While the government believes this as a critical measure to support farmers, critics have raised eyebrows over mortgaging such high-value lands. Amid allegations of paying around one per cent commission i.e. Rs 100 crore to the mediators for approval of the loan amount, the opposition BRS leaders have demanded transparency in the process and urged the government to disclose the details of the mortgaged properties.
“Chief Minister A Revanth Reddy and other Congress leaders opposed the auction and mortgage of valuable government lands while in opposition as well as criticised borrowings at high interest rates. But now, he is making efforts to mortgage the same lands to raise loans,” a BRS leader said.
Telangana witnessed a sharp decline in its revenue receipts compared to last year and collected around Rs 90,844 crore till October this year. Of the Rs 49,255 crore proposed to be raised through market borrowings this year, the government already obtained around Rs 37,450 crore till December 3 and has scope to get around Rs 950 crore this month as per RBI’s advanced approvals.
An indent has been submitted to raise another Rs 1,000 crore during the auction of State government securities on December 17 which will be last tranche for the third quarter ending this month.
Amid poor revenue collections and growing expenditure, the State government proposed to revise budget estimates for market borrowings and draw another Rs 10,000 crore in addition to the remaining Rs 11,805 crore approved by the RBI during the last quarter of 2024-25 financial year. An approval from the RBI is awaited in this regard.
