THIRUVANANTHAPURAM: The government of Kerala is raising Rs800 crore through the sale of 10-year state development bonds (SDLs).
The proceeds of the loan will be utilized for financing productive development programmes and projects to be implemented in the state, according to a circular issued by the Department of Finance, Kerala.
It was on October 1, the government raised funds last time through debt, when it sold SDLs of 15 years of tenure to raise Rs1500 crore.
The auction of SDLs will be conducted by the Reserve Bank of India at its Mumbai office on December 4, 2018. Raising funds through the sale of state development bonds (SDLs) is part of the debt raising programme that has been designed for the deficit financing under the state budget, and consent of Central Government has already been obtained for the floatation of this loan as required by Article 293 (3) under the Constitution of India.
Rate of interest
The cut-off yield determined at the auction will be the coupon rate per cent per annum on the stock sold at the auction. The interest will be paid on June 5, and December 5 of each year until the maturity.