Hyderabad: The cash-starved Andhra Pradesh
State Road Transport Corporation (APSRTC) today got the state
government`s nod to borrow Rs 400 crore from banks to clear
the salary arrears of employees.
APSRTC Vice-Chairman and Managing Director B Prasada Rao
informed the state government that the Corporation requires Rs
450 crore to clear the arrears and requested the latter to
release the amount it owed them or grant permission for
obtaining a loan.
The state government owed Rs 613.93 crore to APSRTC
towards reimbursement of various concessions granted to
passengers. The government, however, earmarked only Rs 154.76
crore in the current year`s budget for the Corporation.
Since it is not in a position to clear the dues in full,
the government agreed to RTC`s proposal for availing of bank
loan and permitted it (Corporation) to secure the money in two
equal installments of Rs 200 crore.
The state government will stand guarantee for the loan
and also service it, according to Principal Secretary
(Transport) S P Singh.
Accordingly, RTC will borrow Rs 200 crore in the first
phase from Bank of India at the interest rate of 8.25 per cent
per annum, to be repaid in five years.