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Maharashtra has approved a state guarantee of INR 3,000 crore for a HUDCO loan to acquire land for the International Business and Finance Centre in Nagpur. The project, part of the 'New Nagpur' initiative, will be developed by NMRDA across 692 hectares in Godhani and Ladgaon villages. The total loan planned is INR 6,500 crore, with strict conditions ensuring the state bears no liability for defaults. NMRDA must submit regular reports, and any sale of mortgaged assets requires committee approval. The IBFC aims to make Nagpur a central Indian business hub.
The Maharashtra government has approved a state guarantee of INR 3,000 crore to secure a loan from central finance institution HUDCO for acquiring land for an International Business and Finance Centre (IBFC) in Nagpur. This initiative is part of the broader 'New Nagpur' project and will be executed by the Nagpur Metropolitan Region Development Authority (NMRDA) across roughly 692 hectares in the villages of Godhani (Khurd) and Ladgaon (Khurd) in Hingna tehsil. Advertisement
The state finance department issued a Government Resolution (GR) following a cabinet decision earlier this year to provide the guarantee. The plan involves borrowing a total of INR 6,500 crore from HUDCO for the development of the IBFC, with the initial INR 3,000 crore guarantee specifically allocated for the first phase of land acquisition. The guarantee will remain valid for 12 months from the GR's issuance.
The government has set strict conditions for the guarantee. NMRDA will act as the principal debtor, and the state will not be responsible for any delayed payments or penalties. The resolution emphasizes that in case of default, mortgaged movable and immovable properties of the authority must be sold to recover the loan before the government guarantee can be invoked.
NMRDA is required to provide monthly progress reports on loan repayment and financial status reports every six months to the urban development and finance departments. A guarantee fee of INR 0.50 per INR 100 per year of the outstanding loan amount will apply, payable biannually by April 1 and October 1. Late payments will carry interest at 16% for the first three months and 24% thereafter.
Additionally, any sale of mortgaged assets must receive approval from a committee comprising representatives from urban development and finance departments, with final consent from the state administration.
The IBFC project aims to establish Nagpur, Maharashtra's second capital in the Vidarbha region, as a major business and financial hub in central India.
Source PTI
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