Samurai Loan

Syllabus subtopic: Effects of Liberalization on the Economy, Changes in Industrial Policy and their Effects on Industrial Growth.

Prelims and Mains focus: about the Samurai loans raised by NTPC and its utility

News: India’s largest power generator NTPC Ltd has raised a $750 million-worth term loan in Japanese yen, claiming it to be the “largest ever” Samurai loan raised by any Asian corporate.

What are Samurai loans?

Samurai loans allow non-Japanese firms to tap into the investment capital available in Japan and borrow funds in yen, which is among the currencies with the lowest interest rates.

The cross-border syndicated loan provides the borrower with capital to either enter the Japanese market or the ability to convert the proceeds into the firm’s local currency for use in existing operations.

How were the funds raised?

The loan was raised under the automatic route of RBI’s External Commercial Borrowing regulations and has been fully underwritten by the State Bank of India in Tokyo, Sumimoto Mitsui Banking Corporation in Singapore and Bank of India, Tokyo.

The facility has a door-to-door maturity of 11 years — the period within which the amount would have to be paid back — under two tranches.

What would be the funds used for?

The funds raised would be used towards implementing systems that would help the state-owned power giant fund Capex for the installation of a Flue Gas Desulphurization (FGD) system that helps in the substantial reduction of toxic sulphur oxide (SOx) emissions.

It would also be invested in NTPC’s new hydro projects as well as projects using ultra-supercritical technology, which are plants that require less coal per megawatt-hour and, therefore, lead to lower carbon emissions.

Finance Minister said in her Budget speech that utilities running thermal power plants with high carbon emission levels are advised to close those plants with emissions above pre-set norms.

Source: Indian Express

Join Our Telegram

Locust attack in Punjab

Anti-dumping duty

Pradhan Mantri Suryodaya Yojana

06 Feb, 24
SHARE

Recently, Prime Minister announced Pradhan Mantri Suryodaya Yojana under which 1 crore households will get rooftop solar power systems. India’s Status of Current Solar Capacity India currently stands at 4th place globally in solar power capacity. As per Ministry of New an

Foreign Contribution Regulation Act (FCRA)- NGO

06 Feb, 24
SHARE

The Foreign Contribution Regulation Act, 2010 (FCRA) registration of two prominent non-governmental organisations (NGOs) — Centre for Policy Research (CPR) and World Vision India (WVI) have been cancelled this month. What is FCRA? Key provisions of FCRA, 2010 Key aspects Description

Voice clone-AI

06 Feb, 24
SHARE

Voice clone fraud has been on the rise in India. AI voice cloning – It is the process of creating a synthetic replica of a person’s voice through machine learning and speech synthesis technology.It is called as voice deepfakesor audio deepfakes. Objective – To achieve a high level of na

Science communication- how to promote

06 Feb, 24
SHARE

Steps taken by India to promote Science Communication Publications and Information Directorate (PID) - An organisation under Council of Science and Industrial Research (CSIR) established in 1951 for publishing and disseminating scientific information in India. National science magazines- The PI

Universal Basic Income (UBI)- Analysis

05 Feb, 24
SHARE

Universal Basic Income (UBI) can strengthen welfare architecture and unlock the nation’s latent demographic potential. UBI - It is an income support mechanism typically intended to reach all or a very large portion of the population regardless of their earnings or employment status. Objective- To provide enough to co