The Cabinet Committee on Economic Affairs,
chaired by the Prime Minister Shri Narendra Modi has given its approval for
waiving of Penal Interest on Government Loans to Paradip Port Trust (PPT) and
Visakhapatnam Port Trust as per following:
Paradip Port Trust
penal interest amounting to Rs.1076.59 crore in respect of PPT as on 31.03.2017
and further accruals thereon till date of approval of waiver.
PPT to pay
penalty @ 0.25% of Penal Interest as on the date of approval of waiver of penal
PPT to start
the re-payment of outstanding principal of Rs. 387.74 crore and outstanding
interest as on date of approval of the waiver and the re-payment to be
completed in two instalments in 2018-19 and 2019-20.
Trust (PPT) had availed Rs.642.69 crore of loan under different heads at
different points of time beginning from 1967 to 2002 to finance its various
infrastructure projects. Each loan was to be repaid in 20 yearly installments
with a five year moratorium period. PPT was incurring losses upto the year
1987-88 and there was huge deficit in revenue account due to insufficient
cargo. As a result of which PPT could not start its repayment as per
schedule. As on 31.03.2017, PPT has a total loan liability of Rs. 1743.69 crore
(Rs.387.74 crore towards defaulted principal, Rs.279.36 crore towards interest
and Rs. 1076.59 crore towards penal interest).
Port has a future fund requirement of around Rs.6,695 crore for different
upcoming developmental projects and employees’ pension liabilities upto
2018-19. Therefore, the Port is not in a position to repay the total loan
liability of Rs.1,743.69 crore.
Visakhapatnam Port Trust
Penal Interest amounting to Rs. 250.89 crore in respect of VPT as on 31.03.2017
and further accruals thereon till date of approval of waiver;
VPT to pay
penalty @0.25%of Penal Interest as on date of approval of waiver of Penal
VPT to pay
the outstanding Principal of Rs. 44.69 crore and outstanding Interest as on the
date of approval of waiver, in one single instalment in the Financial Year
Port Trust (VPT) had availed Rs. 110.41 crore of loan at different points of
time beginning from 1970-71 to 1984-85 to finance its Outer Harbour Project to
accommodate deep draft vessels of 100,000 DWT for Iron Ore exports. Each loan
had a moratorium period of 5 years from the date of sanction. VPT made payments
towards interest for the period of moratorium on various loans till 1978-79.
However, it could not be continued with the repayment during the period from
1979-80 to 1989-90 due to revenue losses to the Port. It started repayment of
loan amount (both principal and interest) with effect from 1990-91 onwards. As
on 31.03.2017, VPT has a total loan liability of Rs. 354.23 crore (Rs. 44.69
crore towards defaulted Principal, Rs. 58.65 crore towards defaulted Interest
and Rs. 250.89 crore towards Penal Interest).