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Govt. not taking loans without need: CM

By Our Special Correspondent

Bangalore March 27. The Chief Minister, S.M. Krishna, today told the Legislative Council that the Government did not believe in unnecessary borrowings from financial institutions, though institutions such as the World Bank and the Housing and Urban Development Corporation (Hudco) were offering loans.

Replying to a question from B.S. Yediyurappa during Question Hour, he said loans were obtained to build assets and enhance the Gross State Domestic Product. It was improper to say that the Government borrowed money largely to clear its dues to financial institutions, though some of the loans taken recently were "swapped" with those taken earlier at a higher rate of interest. The interest rates of banks had been falling in recent years, and the Government would obviously like to derive the maximum benefit, he added.

Mr. Krishna said the total loans taken by the State were about Rs. 38,000 crore. The Government did not avail of loans directly from the World Bank, and they were obtained through the Union Government and were regarded as additional Central assistance for the Plan expenditure of the State. Utmost care was taken to ensure that the funds were appropriately utilised, the Chief Minister said.

Dues to contractors

To another question from Mr. Yediyurappa, the Chief Minister said the dues to contractors of the Public Works and Irrigation departments would be cleared gradually. A sum of Rs. 100 crore would be paid to contractors in a few days. The total dues for completed works was about Rs. 625 crore, and this included Rs. 210 crore to PWD contractors and nearly Rs. 400 crore to those of the major and minor irrigation departments. Efforts were being made to secure the amount due to the Commercial Taxes and Excise Department, which could be utilised to pay civil contractors' dues.

Plea on IAS posts

Replying to a question from Basavaraj Horatti, Mr. Krishna said the Government would write to the Centre requesting that at least 50 per cent of posts in the Indian Administrative Service in the State be given to officers of Karnataka Administrative Service. At present, the ratio of IAS officers to KAS officers was 2:1. In 2001, the State made a representation to the Centre to enhance the State quota, and it was turned down. The request would be made again, and the Government would write to chief ministers of other States seeking their cooperation in the matter. There were 256 IAS officers in the State, and the Government would request the Accountant General to approve the salaries of a few officers who were in excess of the quota prescribed, Mr. Krishna said. To a question from M.C. Nanaiah, the Chief Minister said the Government had at one point considered seeking the disbanding of the Karnataka Public Service Commission. It could not go ahead with the proposal since the KPSC was a constitutional body, and as it was necessary to conduct interviews of candidates to get an idea of their personality. The Government had, however, reduced the marks for the interview from 200 to 105, he added.

Power project

Replying to a question from P. Ramiah, the Minister of State for Energy, Basavaraj Patil Humnabad, said the Tamil Nadu and Karnataka governments would reach an understanding on the Shivanasamudram hydroelectric project in a few days and submit a proposal to the Centre. The project proposal was put forward several years ago, and both the States would stand to benefit from it.

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