The state-run National Credit Guarantee Trustee Company (NCGTC) has given notice of the proposed Rs 50,000 crore guaranteed credit scheme for strengthening health infrastructure, which will cover loans sanctioned between May 7, 2021 and March 31, 2022, or until the limit is exhausted .
Credit, backed by a sovereign guarantee, will be extended to private hospitals to expand their existing facilities or set up new units outside the eight largest cities to help fight the Covid-19 pandemic.
The scheme was part of the Rs 6.29-lakh-crore aid package announced late last month. With the package, the government sought to strengthen the fight against the pandemic and stimulate economic growth through continued credit pressures.
The state-run National Credit Guarantee Trustee Company (NCGTC) has notified a scheme under which loans of Rs 50,000 crore, backed by a state guarantee, will be provided to private hospitals to expand their existing facilities or set up new units outside the country. top eight cities to help fight the Covid-19 pandemic.
The plan to strengthen health infrastructure, part of the Rs 6.29-lakh-crore aid package announced late last month, will cover all loans sanctioned on or after May 7 until March 31, 2022. The move was part of the government’s efforts to fight the pandemic and boost economic growth through continued credit pressures.
Any investor can get a loan of up to Rs 100 crore (including both fund and non-fund based exposure). The interest is capped at 7.95% per year. Warranty coverage is limited to 50% for expansion and 75% for new projects. However, coverage will be 75% for both greenfield and brownfield projects in the 125 government-registered “ambition neighborhoods”.
Credit will be provided for the establishment or expansion of hospitals, pharmacies, clinics, medical colleges, pathology labs and diagnostic centers. The facility is also available for the production of vaccines, oxygen, ventilators and priority medical devices, and for public health care facilities. The units in the municipal areas of New Delhi, Mumbai, Kolkata, Chennai, Bangalore, Ahmedabad and Pune are not covered by the scheme.
The official guarantee is granted for a maximum period of 2 years from the date of commencement of commercial activities, with a maximum of five years from the date of first disbursement in the case of brownfield projects, according to the NCGTC. For greenfield projects, the coverage is up to five years from the date of first payout.
Finance Minister Nirmala Sitharaman had also announced an additional guaranteed credit facilities of Rs 60,000-crore for other sectors struggling to cope with the damage caused by the pandemic.