Today in New Delhi, India
Sep 24, 2018-Monday
-°C
New Delhi
  • Humidity
    -
  • Wind
    -

Chhattisgarh refuses to pay its share

IN ANOTHER instance of shirking its liability and claiming only assets from its parent state Madhya Pradesh, Chhattisgarh has refused to pay its share of 26.62 per cent of the LIC loan due on Madhya Pradesh at the time of state?s bifurcation. A loan repayment of Rs 95.34 crore was due on Madhya Pradesh at the time of bifurcation in 2000. The loan was availed for various social housing schemes implemented in the undivided Madhya Pradesh.

india Updated: Jun 10, 2006 02:00 IST

IN ANOTHER instance of shirking its liability and claiming only assets from its parent state Madhya Pradesh, Chhattisgarh has refused to pay its share of 26.62 per cent of the LIC loan due on Madhya Pradesh at the time of state’s bifurcation. A loan repayment of Rs 95.34 crore was due on Madhya Pradesh at the time of bifurcation in 2000. The loan was availed for various social housing schemes implemented in the undivided Madhya Pradesh.

Meanwhile, with Chhattisgarh’s denial to repay the loan, a war of letters has been carried out between MP, Chhattisgarh and LIC for the past couple of years. No solution emerging from the present situation has obviously added to the woes of insurance behemoth.

At the time of bifurcation, Madhya Pradesh proposed the sharing of liability according to population ratio. Hence 73.38 per cent of the loan amount came Madhya Pradesh way and the remaining 26.62 per cent was due on Chhattisgarh. But, Chhattisgarh Government refused to share the burden stating that none of the housing schemes for which the loan was availed were implemented in their state.

Though Madhya Pradesh Government has repaid Rs 44.23 crore, non-payment of loan by Chhattisgarh has created problems before the leading insurance company of the country.

Taking this issue seriously, the head office of Corporation recently wrote a letter to Madhya Pradesh Principal Secretary, Finance, requesting him to clear the remaining amount of loan and clarify MP Government’s stand on the issue of loan bifurcation.

LIC Executive Director (Investment) in his letter said, “This is to bring to your immediate attention that the plan loans availed by erstwhile combined state of MP for their various social housing schemes are still awaiting bifurcation between the newly-formed states of MP and Chhattisgarh even after a lapse of 6 years.”

Though MP Government had provisionally bifurcated the liability in the ratio of population w.e.f. October 2000, the detailed list of loans bifurcated to both states is not available. “In the absence of above information we are not able to apportion the loans between MP and Chhattisgarh,” said LIC Executive Director in his letter.

Chhattisgarh’s denial to part the loan liability is worrying LIC. Chhattisgarh had already clarified that “loans which were taken from the Corporation for housing purpose in the undivided Madhya Pradesh were not used in Chhattisgarh”.

The then Chhattisgarh Special Secretary (Finance) in her letter to LIC mentions the fact that since no development work was
carried out in their state, so as per the division ratio accepted between the two housing boards, no outstanding loans is due from the area of Chhattisgarh to the Corporation.

Hence, the outstanding loans of LIC could not be bifurcated on the basis of population. The letter further points out that, “we have asked MP to provide the details of the projects funded by these loans but no communication has been received so far”.

First Published: Jun 10, 2006 02:00 IST