HYDERABAD: The state government is considering shifting from the present high-cost short term loans to low-cost long-term soft loans with longer moratoriums to reduce the financial burden on the irrigation sector.
Currently, the state is grappling with the high cost of short-term loans, which are putting pressure on the treasury. By opting for long-term loans, the government aims to ease the burden of EMI repayments and reduce interest costs. Irrigation Minister N Uttam Kumar Reddy has also requested a moratorium of five years on irrigation loans from Asian Infrastructure Investment Bank (AIIB).
The minister held a meeting with representatives of the AIIB at Jal Soudha here on Tuesday which was attended by key officials, including the Irrigation department adviser Adityanath Das, Secretary Rahul Bojja, Special Secretary Prashant Jeevan Patil, Chief Engineers Anil Kumar and Nagender Rao and AIIB representatives Sangma Kim and Rajesh Yadav.
During the meeting, Uttam pointed out that shifting from short-term to long-term loans would not only reduce the financial strain on the state but also offer flexibility in interest payments. He stated that this move would help expedite the completion of pending irrigation projects, thereby enabling the creation of new ayacut areas. The minister urged the AIIB representatives to apply these loans to ongoing projects to ensure their timely completion.
