WBIDC loans may get cheaper

West Bengal Industrial Development Corporation (WBIDC), the state's industry promotion unit, may slash interest rates on long term loans.

WBIDC has reduced interest rates on 5-7 year loan twice in last 10 months, bringing down rates from 13.5 per cent to 12.5 per cent in September in 2003 and then to 11 per cent earlier this year.

"The revision is being done keeping in mind the present market situation. WBIDC is presently looking at various parameters of business to arrive at the extent of the cut," sources said.

Industry in the state access loans at least 200 basis points cheaper on long term debt.

"WBIDC has to compete with banks and other lending institutions while providing loan assistance to new units. For instance, West Bengal Financial Corporation, state's lending agency for the small and medium scale units, charges about nine per cent," one industry observer pointed out.

The role of WBIDC is not similar to banks or other institution, its erstwhile chairman Somnath Chatterjee, now the Speaker of 14th Lok Sabha, pointed out today at a felicitation ceremony organised by WBIDC in his honour. Chatterjee said the role of WBIDC was not only to make profits but help others make profit.

WBIDC has a developmental and promotional role assigned to it. It sanctions and disburses loan to units which may have to pay more to other lending institutions, industry sources said.

In 2003-4, WBIDC earned operating profit of Rs 14.08 crore.

West Bengal industry minister Nirupam Sen who replaced Chatterjee as the chairman of WBIDC was also present at the felicitation ceremony. He said WBIDC would strive to dispel the negative image of Bengal.