New Delhi; The government today decided to release Rs4,868 crore to public sector lenders for providing concessional loans to farmers. The decision, taken at a Cabinet meeting, will help lenders provide farmers short-term crop loan at 7% interest, reports PTI.
"The Union Cabinet today gave its approval for the release of Rs4,868 crore as interest subvention to public sector banks (PSBs), regional rural banks (RRBs), co-operative banks and the National Bank for Agriculture and Rural Development (NABARD) for refinance to RRBs at concessional rates to reimburse the amount of interest subvention to ensure that the farmer, in general, should receive short-term crop loan at 7% per annum this fiscal," the government said in a statement.
The lenders would have given loans to farmers at 9%, had the subsidy of 2% not been provided by the government.
The government has, since 2006-07, been subsidising short term crop loans so as to ensure the availability of funds to farmers.
This interest subvention scheme has been continued for 2010-11 for public sector banks, regional rural banks and co-operative banks.
In 2009-10, an additional subvention of 1% was being provided to farmers who repaid on time.
This has been increased from 1% in 2009-10 to 2% in 2010-11. Thus, the effective rate of interest for such farmers will be 5% per annum.
The banks have been consistently meeting the targets set for agriculture credit flow in the past few years. For 2010-11, the target for agricultural credit flow has been raised to Rs3,75,000 crore from Rs3,25,000 crore in 2009-10.
Mumbai: UltraTech Cement Ltd on Thursday said with the merger of Samruddhi and acquisition of ETA Star Cement, its manufacturing capacity will touch 52 million tonnes per annum (MTPA) making it the ninth largest cement firm in the world, reports PTI.
"With the amalgamation of Samruddhi and the acquisition of ETA Star Cement in the UAE, our cement manufacturing capacity will stand augmented to 52 MTPA, making us the 9th largest cement company in the world," Aditya Birla Group firm UltraTech Cement's chairman Kumar Mangalam Birla told shareholders here.
As a part of the consolidation process, the cement business of Grasim Industries, the company's holding firm, was demerged into a separate entity—Samruddhi Cement, which is now amalgamated with the company. The appointed date of the scheme of amalgamation is 1st July and it will be rendered effective from 1st August, Mr Birla said.
The company's board also approved the acquisition of ETA Star Cement Company LLC, Dubai, together with its operations in the UAE, Bahrain and Bangladesh. This has been done through its wholly-owned subsidiary in Dubai.
"The acquisition is expected to be completed shortly.
It gives us a foothold in the Middle East. It is also in line with our group's long-term strategy of expanding our global presence across businesses," Mr Birla said.
The company is also poised to become the largest cement company in India. With a 49 million tonnes per annum of grey cement across 22 plants and 9.5 million cubic metres of ready mix concrete across 73 plants, it will have a market share of around 20%.
It has drawn up a capital expenditure plan of Rs10,738 crore for expansion programme over the next three years.
The company plans to increase the grinding capacity in Gujarat and set up additional grinding units across locations.
It is also setting up clinkerisation plants through brownfield expansion in Chhattisgarh and Karnataka. The projects will be funded through a judicious mix of internal accruals and borrowings, Mr Birla said.
UltraTech Cement's net profit slumped 41.87% to Rs 243 crore on 8.35% fall in net sales to Rs1,790 crore in Q1 FY 11 over Q1 FY 10.
The profitability of the company was affected due to an over-supply scenario in the cement sector and substantial increase in raw material costs, Mr Birla said.
Commenting on the cement industry scenario, Mr Birla said the demand of cement has grown around 12% in FY10.
However, significant capacity additions have resulted in a surplus scenario. These capacity additions, which will continue in the current year will lead to a further surplus scenario over the next 18-24 months. This will impact cement prices, Mr Birla said.
GMR has achieved financial closure for refinancing its $837-million debt raised for purchasing stake in InterGen NV in 2008. The two-year bridge loan has now been converted into a five-year loan.
“We have achieved the financial closure for our $837-million debt for the refinancing for (the) InterGen (stake buy). The project was earlier refinanced with a bridge loan for a two-year period, which ends in October 2010. This has been replaced by a regular five-year loan facility,” said Madhu Terdal, president, New and Emerging Businesses, GMR Infrastructure.
Axis Bank and ICICI Bank are the lead bankers for this refinancing. Bank of Baroda, Bank of India, Indian Bank, Indian Overseas Bank and Syndicate Bank are among the other banks that have formed the financing consortium.
GMR had acquired the 50% stake in InterGen from AIG Highstar Capital II LP, a fund owned by the American International Group (AIG). Back in 2008, according to a press release issued by GMR, the transaction was valued at $1.1 billion. This was touted as one of the biggest Indian overseas acquisitions then.
The infrastructure group had raised $837 million through debt for its stake purchase in InterGen. This debt was financed through a bridge loan, which was scheduled to end in October 2010.
Recently, GMR and InterGen have been in the spotlight ahead of international news reports of GMR looking for buyers to sell their stake in InterGen. Mr Terdal has refuted these news reports as mere speculation.
For the past few months, various media sources have also reported on GMR looking for banks to refinance this $837-million debt.
InterGen has 12 power plants located across the UK, the Netherlands, Mexico, Australia and the Philippines. GMR’s presence in these countries is only due to the InterGen acquisition. InterGen, with its headquarters in the Netherlands, was delisted from the Singapore Stock Exchange in 2008.
While GMR holds 50% stake in InterGen, the balance 50% in InterGen is held by Ontario Teachers’ Pension Plan. This Canadian pension plan has held this stake in InterGen since 2005.
According to a Wall Street Journal report, InterGen seeks to expand in Asia, North America and the UK. The company estimates it will make $600 million in earnings before interest, taxation, depreciation and amortisation for 2010, people familiar with the matter said.