Govt to sell, mortgage KSRTC's shopping complexes to cover KTDFC's financial liabilities

Thiruvananthapuram: The Kerala Government aims to overcome the financial woes faced by the Kerala Transport Development Finance Corporation Limited (KTDFC) by selling or mortgaging the shopping complexes owned by KSRTC (Kerala State Road Transport Corporation). 

The Finance Department has directed KTDFC to sell or mortgage KSRTC's assets to return matured fixed deposits to its investors. 

The state government informed the High Court (HC) the other day that it was undergoing a severe financial crunch. The remark from the state came in the case relating to KTDFC. However, the court criticised the state's argument, stating that it put the state in a bad light.

The government’s stand is that it cannot take up KTDFC’s liability. However, people deposited their money in KTDFC under a guarantee from the government. If the state refuses to take responsibility, who would be willing to invest in the state, the court asked. Therefore, the HC demanded that the affidavit be revised and filed again.

Based on this, the Under Secretary of the Finance Department submitted a fresh affidavit on Thursday informing the decision to sell or mortgage two of the KSRTC's four shopping complexes in Kozhikode, Angamaly, Thiruvalla and Thiruvananthapuram. The government order directs KSRTC to hand over the shopping complexes and the adjoining land to KTDFC. 

KTDFC earlier informed the state government that the reason for its crisis is the non-repayment of the Rs 360 crore it loaned to KSRTC. This amount has now gone up to Rs 900 crore with interest. However, KSRTC is not in a position to repay the money. Thus, KTDFC wants the government to take up this liability and make the payment. In 2021-22, the Reserve Bank of India prohibited KTDFC from accepting deposits which cut off its income source.