The state-run National Credit Guarantee Trustee Company (NCGTC) has notified the proposed Rs 50,000 crore secured credit scheme for strengthening health infrastructure, which will cover loans sanctioned between May 7, 2021 and May 31, 2021. March 2022, or until the limit is exhausted.
The credit, backed by a sovereign guarantee, will be extended to private hospitals to expand their existing facilities or create new units outside the first eight cities to help fight the Covid-19 pandemic.
The program was part of the Rs 6.29-lakh-crore relief package announced at the end of last month. Through this package, the government has sought to step up the fight against the pandemic and boost economic growth through a sustained credit surge.
The state-run National Credit Guarantee Trustee Company (NCGTC) has notified a program whereby loans of Rs.50,000 crore, backed by a sovereign guarantee, will be extended to private hospitals to expand their existing facilities or create new ones. new units outside the eight main cities to help fight the Covid-19 pandemic.
The health infrastructure strengthening program, which is part of the Rs 6.29 lakh-crore relief package announced at the end of last month, will cover all sanctioned loans from May 7 through March 31, 2022. The move was part of the government’s efforts to step up the fight against the pandemic and spur economic growth through a sustained credit surge.
Each investor can be granted a maximum loan of Rs 100 crore (including fund exposure and not fund based). The interest rate will be capped at 7.95% per annum. Warranty coverage will be limited to 50% for expansion and 75% for new projects. However, coverage will be 75% for greenfield and brownfield projects in the 125 “ambitious districts” notified by the government.
Funds will be granted for the creation or expansion of hospitals, dispensaries, clinics, medical schools, pathology laboratories and diagnostic centers. The facility is also available for the manufacture of vaccines, oxygen, ventilators and priority medical devices, as well as for public health facilities. Units located within the municipal areas of New Delhi, Mumbai, Kolkata, Chennai, Bangalore, Ahmedabad and Pune will not be covered by the program.
The official guarantee will be provided for up to 2 years from the date of commencement of business operations, subject to a maximum period of five years from the date of first disbursement in case of brownfield projects, according to the NCGTC . For completely new projects, coverage will last up to five years from the date of the first disbursement.
Finance Minister Nirmala Sitharaman also announced additional secured credit facilities of 60,000 crore for other sectors, struggling to cope with the damage caused by the pandemic.