Orders have been issued constituting the Telangana Drinking Water Supply Corporation (TDWSC) to execute and maintain the Telangana Drinking Water Supply Project (Mission Bhagiratha).
ICICI Bank, Hyderabad, while enclosing the terms and conditions applicable to obtain loan from them for providing financial assistance to Telangana Drinking Water Supply Corporation to Provide Secondary Transmission System from Yellore Reservoir in Mahabubnagar District to Provide Drinking Water to Mahabubnagar district (Part-II) has sanctioned a loan amount of Rs.1500.00 crores out of the project cost Rs.2703.00 crores (excluding Interest During Construction).
The Engineer-in-Chief, Rural Water Supply & Sanitation, Hyderabad has submitted the proposal to the ICICI Bank for providing financial assistance to Telangana Drinking Water Supply Corporation to Provide Secondary Transmission System from Yellore Reservoir in Mahabubnagar District to Provide Drinking Water to Mahabubnagar district (Part-II) under Mission Bhagiratha for sanction of loan of Rs.1500.00 crores out of the total project cost of Rs.2703.00 crores (excluding Interest during construction). He has also stated that the ICICI Bank, Hyderabad has forwarded the loan sanction letter for implementation of the above segment for an amount of Rs.1500.00 crores along with terms and conditions for acceptance of the competent authority. As such, he has requested the Govt., to provide concurrence/approval for the terms and conditions of loan sanctioned for the above segment and to issue necessary orders on the required documents to be provided by the Govt., in order to execute the loan agreement with ICICI Bank. In the 4th read above, the ICICI Bank has conveyed the revised terms and conditions of sanction of term loan.
Government after careful consideration of the matter, hereby accord permission to the Managing Director, Telangana Drinking Water Supply Corporation to borrow the loan amount of Rs.1500.00 Crores (Rupees One thousand and Five hundred crores only) which is part funded by the ICICI Bank out of the total debt of Rs.2162.40 for Providing Secondary Transmission System from Yellore Reservoir in Mahabubnagar District to Provide Drinking Water to Mahabubnagar district (Part-II) under Mission Bhagiratha, out of the total project cost of Rs.2703.00 crores (excluding Interest during construction), as per the terms and conditions of ICICI Bank at the interest rate of 8.70% (1 year MCLR i.e. 8.20 + 0.50 %) with yearly reset. Government of Telangana will enter into an MOU for the repayment of loan taken from ICICI Bank covering principle and interest. The State margin money (i.e., 20% project cost) of Rs.375.00 crores (Rupees Three hundred and Seventy Five crores only) will be met by the Government of Telangana through budgetary support. The terms and Conditions approved by the Govt., are appended as annexure to this order.
5. The Managing Director, Telangana Drinking Water Supply Corporation shall take necessary action in the matter accordingly.
6. This order issues with the concurrence of the Finance (DCM) Department vide their U.O.No.1486/124/A1/2017, dated:21.7.2017.
The following one part of the Project under TDWSCL
• Part-II: Providing secondary transmission system to provide drinking water to 55 mandals and 9 municipalities of Mahabubnagar district segment I including operation and maintenance for 10 years with total project cost of Rs. 27.03 billion (excluding IDC)
|Project Cost (excluding IDC)||27.03||100.00%|
Above debt equity ratio is to be maintained till the completion of the Project. Interest During Construction (IDC) is proposed to be funded by Sponsor.
Out of above Project cost Rs.27.03 billion, debt component is Rs.21.62 billion.
Out of total debt component,
- Rupee term loan assistance aggregating up to Rs.15.00 billion (the “Facility Amount”) to be underwritten by ICICI Bank Limited
ICICI Bank Limited will act as an Arranger for the remaining amount of Rs.6.62 billion either in the form of RTL or Debentures.
The proceeds of the Facility shall be utilized for the purpose of:
- Financing the Project Cost (including reimbursement of expenditure already incurred) of following one part of the Project under TDWSCL
- Part-II: Providing secondary transmission system to provide drinking water to 55 mandals and 9 municipalities of Mahabubnagar district segment I including operation and maintenance for 10 years with total project cost of 27.03 billion (excluding IDC)
- Expenses in relation to the Facility
Any funding towards IDC by the Lenders shall increase Promoter contribution to that extent.
Within the overall Facility limit.
The facility either in part or full will not be used for investment in capital market, land acquisition, acquiring equity shares of Indian company/ies, buyback of shares of Indian company, funding of promoters’ contribution in the Project or any other purpose, which is prohibited or any illegal activity.
|The rate of interest for each drawal of the Facility will be stipulated by ICICI Bank Limited at the time of disbursement of each drawal, which shall be sum of I-MCLR-1Y+ “Spread” per annum, subject to minimum of I-MCLR-1Y, plus applicable interest tax or other statutory levy, if any.|
As on date the I-MCLR-1Y is 8.20% and Spread is 0.50% p.a. Effective interest rate as on date is 8.70% p.a.
Above interest rate shall be reset at the end of every 1 year from the date of disbursement of the first drawal of the Facility as a sum of I-MCLR-1Y + “Spread”, prevailing on the reset date plus applicable interest tax or other statutory levy, if any. Any change in “Spread” would be as communicated by the Bank from time to time.
In case there is any change in the regulatory requirements pertaining to provisioning norms and/or risk weight applicable to the facility, the Bank may revise the spread to reflect the regulatory change, subject to extant Reserve Bank of India (RBI) guidelines.
The Borrower will have the option to prepay the loan without any prepayment penalty within 60 days of such increase in “Spread” provided an irrevocable notice to prepay the loan has been given by the Borrower to the Bank within 15 days of such increase in “Spread”.
Except mentioned elsewhere, if the Borrower wishes to prepay the Facility, it may do so with payment of Prepayment Premium of 1.0% on principal amount of the loan prepaid subject to the Borrower giving at least 15 days prior written notice of the same to the Bank.
The Borrower may make Voluntary Prepayment with payment of prepayment premium of 1.00% of the principal amount of loan prepaid, subject to:
Any such prepayments shall reduce the amount of repayment installment of the Facility in the inverse order of maturity. Any amount prepaid shall not be redrawn.