B'lore Metro to get subordinate debt not duty exemption

New Delhi, Apr 28: Union Urban Development Minister S Jaipal Reddy today said the Centre had not granted Custom Duty exemption on the import of equipment for execution of the Bangalore Metro project but it would be getting a 'subordinate debt' to offset the losses suffered because of denial of duty exemption.

Addressing a delegation of Andhra Pradesh MPs and MLAs who met him to discuss the Hyderabad Metro project, Mr Reddy said although the Centre had not provided duty exemption as sought by the Karnataka Government, it had granted five per cent subordinate debt to make good the loss of Rs 360 crores incurred due to the project. This is as good as a grant because these debts will be the last to be repaid by the state after clearing the loans taken from the Japanese Bank for International Coperation (JBIC), he said.

Yesterday, the Union Cabinet had cleared this 33 km long two corridor project and the project is scheduled to be completed by 2011. Seventy per cent of the project will be financed through debts while the State and the Centre will be funding 30 per cent of the project.

UNI