$1bn loan to Adani: Will take final decision in 3 months, says SBI

New Delhi: State Bank of India has said the final decision on the controversial USD 1 billion (Rs 6,200 crore) loan agreement with Adani Group for its Australian mining project would be taken by the executive committee of the bank in 2-3 months.

SBI had last month signed the pact with Adani Group on the sidelines of Prime Minister Narendra Modi’s visit to Australia.

“The executive committee after due deliberations will decide about the disbursement to Adani,” State Bank of India (SBI) Chairperson Arundhati Bhattacharya told PTI.

“At present, all the aspects are being studied. Appraisal is being done. It will take about two-three months to study the project and thereafter taken to the committee for final approval,” she added.

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Loans of over Rs 400 crore are generally cleared by executive committee headed by the Chairperson. The other members of the executive committee include two executive directors (of the four managing directors on board) and non-executive director/directors who are present in the city where the meeting is held.

Besides, Reserve Bank nominee director Urjit R Patel (RBI Deputy Governor) is a part of the executive committee. Adani Mining is building a 300-km rail line for its about USD 16 billion Carmichael coal mine project in Australia.

The development of the coal mine located at Queensland in Australia and required infrastructure including railways would cost USD 7.6 billion.

Queensland state’s Coordinator General has approved USD 2 billion (2.2 billion Australian dollars) rail line project called the North Galilee Basin Rail (NGBR) that would link Adani’s Carmichael Coal Mine with Abbot point coal terminal.

Opposition party Congress had raised concerns over SBI’ the USD 1 billion loan pact with Adani Group signed during Prime Minister Narendra Modi’s visit to Australia.

“What was the propriety of the SBI giving the loan to Adani, who was sitting next to Prime Minister during the visit, at a time when some five foreign banks have denied credit to the group for the project?”, Congress General Secretary Ajay Maken had said.

Bhattacharya had clarified the bank had just signed a memorandum of understanding.

“This is not a loan sanction that we have given. It will go through proper due diligence both on the credit side as well as on the viability side… The board will take a call and then only loan will be given,” she had said.

PTI