Thiruvananthapuram: A German bank's offer of a Rs 840 crore loan for flood-ravaged Kerala's rebuilding efforts is likely to face the Union government's refusal as had earlier happened with the United Arab Emirates' offer of Rs 700 crore for the state.
The interest rate of the loan offered by Kreditanstalt für Wiederaufbau (KFW) will be nominal, but it cannot be availed without clearance from the Centre.
The experts assigned by the bank had arrived in Kerala on August 18 itself and toured flood-affected areas for three days. KFW proceeded on their report and offered 9 crore euros, about Rs 840 crore.
The World Bank and the Asian Development Bank too had earlier offered financial support for specific rebuilding plans that Kerala had moved for. The government is trying to obtain all three loans in a consortium pattern.
German aid not new
It's the KFW that is funding the Kochi Water Metro plan – a loan of Rs 760 crore. The interest is just 2%. The KFW had come forward to provide Rs 500 crore for a plan to run buses on liquified natural gas as part of the Kochi Smart City project. The project remains buried with the state government.
The Frankfurt-based KFW bank had earlier offered a loan of Rs500 crore to run liquid petroleum gas (LPG)-powered buses as part of the Kochi Smart City project but it was shelved later caught in red tape.
