Money & Banking

Chidambaram reviews stalled projects in eastern region

Shobha Roy Kolkata | Updated on July 24, 2013

SBI may step in to fund the stalled projects

Finance Minister P Chidambaram, in his meeting with bankers on Wednesday took stock of Rs 31,000 crore worth stalled projects in eastern India.

Of this, nearly Rs 22,000 crore have been funded by banks, said Pratip Chaudhuri, Chairman, State Bank of India. A majority of the projects stalled are in the steel, power and road sectors. A large part of the loans funded by banks have been restructured.

There are close to Rs 2 lakh crore worth stalled projects at the national level, of which bank funding stands at Rs 75,000 crore.

The meeting, which lasted close to two hours, was attended by the SBI chief, the heads of three Kolkata-based public sector banks – UCO Bank, Allahabad Bank and United Bank of India – and representatives from respective companies.

“The Finance Minister spent time understanding various issues including environmental clearances, land acquisition and availability of raw material that are holding up various projects,” Chaudhuri told newspersons on the sidelines of the inaugural session of the banking conclave organised by Federation of India Chamber of Commerce and Industry here today.

Chidambaram also suggested banks to provide extra funding facility to projects which are stalled due to lack of finance.

“In case of consortium lending it is sometimes seen that providing extra funding is not possible as two or three banks in the consortium might be opposed to it. The Finance Minister has suggested that in cases where projects are stalled due to lack of finance, we should provide funding if a majority of banks in the consortium agree to it,” Chaudhuri said.

Of the total projects stalled in Eastern India, two road projects worth Rs 800 crore in West Bengal have come to a standstill, he said.


Published on July 24, 2013

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