Jawaharlal Nehru Port Trust will raise Rs 450 crore (Rs 4.50 billion) to pre-pay high interest World Bank loan, the Lok Sabha was informed on Wednesday.
"JNPT has been authorised to raise Rs 450 crore to pre-pay principal amount of loan balance as on March 2003 to the government and World Bank through commercial borrowings at a lower rate of interest," Minister of State for Shipping Dilipkumar Mansukhlal Gandhi said in a written reply.
Gandhi said the existing loan carried a higher rate of interest and it was expected that the port will be able to borrow the funds at 5-6 per cent interest rates.
Initial loan of Rs 328.16 crore (Rs 3.28 billion) was taken from World Bank at 11.5 per cent for funding the port project along with loan from other agencies like Mumbai Port, Kandla Port and budgetary support from the government.
"The present decision of pre-paying World Bank loan is only to save on debt servicing cost due to reduction in the lending rates," he said, adding it was purely a commercial decision based on the current financial trends.
