New Delhi, Mar 27 (PTI) The finance ministry has approved Rs 7,000 crore worth of Special Banking Arrangement (SBA) for payment of outstanding fertiliser subsidy claims, Parliament was informed today.
Subsidy is released to fertiliser companies depending on the availability of the budget, the government said, adding that in case of shortage of funds it tries to liquidate pending subsidy by arranging loans under the SBA.
As March 21, 2018, subsidy claims to the tune of Rs 9,926.98 crore were pending before the government.
“Department of Expenditure has conveyed its approval for the special banking arrangement up to Rs 7,000 crore subject to following conditions,” Minister of State for Fertilisers Rao Inderjit Singh said in a written reply to the Lok Sabha.
The Department of Fertiliser should use only minimum required amount making sure that amount raised is actually utilised during the current fiscal.
Secondly, the rate of interest to be borne by the government will be 6.84 per cent per annum or the actual rate of borrowing by fertiliser companies, whichever is lower, he added.
Total expenditure on fertiliser subsidy stood at Rs 62.835.89 crore till February of the current fiscal, ending on March 31.
This is published unedited from the PTI feed.