New Delhi, June 6: The government today said it will frame a set of guidelines for receiving bilateral debt in consultation with the countries from which it receives the funds.
The finance ministry said it would take into account the views of the bilateral aid donor countries while framing the rules.
On Monday, the government had announced that it would repay bilateral debt worth Rs 7491 crore ($ 1.6 billion) to more than a dozen countries ahead of schedule this fiscal.
Among the countries are the Netherlands, the Russian Federation, Canada, Sweden, Italy, Denmark, Belgium, Austria, Kuwait, Spain, Switzerland, Saudi Arabia, Australia, the Czech Republic and Slovak.
“This is based on the overall fiscal management policy of the government and has no bilateral relations with donor countries,” said finance secretary S. Narayan after a meeting with the representatives of these countries. He said the involvement of the government leads to universalisation of development models which is counter-productive in today’s scenario.
“To improve the efficiency of the development effort, the government has decided that bilateral assistance which is no longer routed through the government machinery could be accessible to the institutions,” said Narayan.
The finance ministry also said further foreign fund aid would be in the form of grants instead of loans so that the government would have less commitment to repay these loans.