Lending a helping hand to the KSRTC, the government has decided to convert the loan amount given to the corporation in the past five years as share capital. The amount to the tune of Rs 1090,75,97,883 was loaned to the KSRTC during the period from 2008-09 to March 2014.
Besides, Rs 172,37,62,083 considered as interest for the amount has been written off.
The Planning Commission had suggested the government to convert the loan as share in view of the financial crisis the corporation is going through. The move is part of the rejuvenation programme of the KSRTC.
Though the government had lent crores of rupees to the corporation as loan as well as aid, it failed to repay the amount. The Finance Department was against giving more loans to the corporation for the same reason. The KSRTC hopes that the Finance Department’s stand will change in the wake of the government move.
Meanwhile, the repayment of loans taken from external agencies is worsening the crisis being faced by the KSRTC. As of June 2015, the corporation owes Rs 1760.27 crore to various agencies while its asset is only Rs 3674.13 crore. As part of increasing the assets, the land used by the KSRTC in Ernakulam and other districts was handed over by the government to corporation. The move is expected help the KSRTC to get bank loans.
The loan taken by the corporation from KTDFC alone amounts to Rs 1366.19 crore. The monthly repayment including the interest is Rs 56.5 crore.