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Long Term Irrigation Fund

The Honourable Union Finance Minister announced the Long Term Irrigation Fund (LTIF) in the Union Budget 2016–17 for fast tracking the completion of the 99 identified Medium and Major Irrigation projects, spread across 18 states, in mission mode by December 2019. Subsequently, GoI approved the funding for Polavaram project in Andhra Pradesh, North Koel project in Bihar and Jharkhand, Relining of Sirhind Feeder & Rajasthan Feeder Canal in Punjab & Rajasthan and Shahpur Kandi Dam in under the ambit of LTIF. The likely irrigation potential utilization through these projects is estimated to be 8.13 lakh ha.
 
Sources of Funds for Financing under LTIF
 
Under LTIF, NABARD provides loan towards Central Share as well as State Share with a tenor of 15 years.  The Central Share is provided to National Water Development Agency (NWDA), an agency working under the aegis of MoWR, RD & GR, GoI, whereas the loan towards State Share is availed by the State Governments.
 
During 2016-17 & 2017-18, loans were extended towards Central as well as State Share by blending of resources directly raised by NABARD with those raised through GoI serviced Extra Budgetary Resources (EBRs) in the required proportion so as to keep lending cost at 6% per annum. 
 
With the change in funding mechanism with effect from 01st April 2018, loans towards Central Share are entirely funded through EBRs in the form of Government of India fully serviced bonds while the State Share is entirely funded through market borrowings.  The loans are extended to State Governments at 6% per annum and the difference between the cost of fund for NABARD and 6% is compensated by Government of India through Interest Subvention. 
 
Cumulative loan sanctioned as at the end of June 2019 was Rs. 77,081.42 crore; of which Central Share stood at Rs. 42,142.36 crore and State Share at Rs. 34,939.06 crore. Cumulative release constituted 43.54 % (Rs. 17,779.20 crore) of sanctions in case of Central share and 47.14 % (Rs. 16,469.53 crore) in case of States’ share.  
 
Table 6.5: State-wise cumulative loans sanctioned and released under LTIF (as on 30 June 2019)

Sr. no.

State

Loan sanctioned

Loan released

Central share

State share

Central share

State share

1

Andhra Pradesh

425.07

513.87

91.81

489.34

2

Assam

195.04

0.00

3.55

0.00

3

Bihar

240.01

0.00

119.97

0.00

4

Chhattisgarh

165.73

80.07

52.25

0.00

5

Goa

17.60

0.00

0.00

0.00

6

Gujarat

8158.50

3611.03

4972.14

2713.27

7

Jammu & Kashmir

57.34

0.00

28.20

0.00

8

Jharkhand

1847.00

518.10

756.73

518.10

9

Karnataka

1837.34

0.00

773.55

0.00

10

Kerala

48.71

0.00

0.00

0.00

11

Madhya Pradesh

3537.52

2863.18

721.37

733.35

12

Maharashtra

4627.50

15637.98

1157.03

6976.72

13

Manipur

309.86

335.18

174.34

186.80

14

Odisha

2299.67

4690.76

1139.32

1972.27

15

Punjab

143.71

0.00

52.42

0.00

16

Rajasthan

1084.67

257.55

367.81

204.57

17

Telangana

3413.56

0.00

297.00

0.00

18

Uttar Pradesh

4661.86

6431.34

598.39

2675.11

1

Polavaram

6381.54

0.00

5814.15

0.00

2

North Koel Reservoir

1378.61

0.00

659.17

0.00

3

Shahpurkandi

485.35

0.00

0.00

0.00

4

Sirhind and Rajasthan Feeder

826.17

0.00

0.00

0.00

 

Total

42142.36

34939.06

17779.20

16469.53