University of Delhi to take Rs 950 Crore loan from HEFA for infrastructure expansion

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The University of Delhi (DU) will borrow Rs 950 crore from the Higher Education Finance Agency (HEFA) for infrastructure development and capital creation. The borrowed money will be used to create university blocks in two areas – Roshapural and Surajmal Vihar, among other things, a leading news agency reported.

The land for the blocks had been acquired by the university long ago. The university will construct new buildings for the faculty of technology, a new girls’ hostel at the Daka complex and two university blocks at the Delhi School of Economics as part of its infrastructure expansion efforts. In addition, the university will carry out renovations of Gwyer Hall Hostel, Faculty of Art, Jubilee Hostel, Convocation Hall, Tagore Hall and Shankar Lal Hall among various buildings from South Campus.

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HEFA’s loan proposal was first discussed at the Delhi University Executive Council meeting on March 25. The university cited the limited allocation of funds for capital creation as a reason for reviewing HEFA loans. The Ministry of Education has stated that all major variety infrastructure projects will be funded solely by HEFA and no funds will be released as budget support. Under the HEFA funding model, the university will have to repay the loan in 20 semester installments over 10 years.

The loan from HEFA will carry an interest rate of 7% per annum. The Delhi University Finance Committee had initially approved a loan of Rs 1,045.75 crore, however, on the advice of the Ministry of Education, it was reduced to Rs 950 crore. The university has also been granted Rs 120 crore for construction and establishment of other infrastructure projects under the Economically Weaker Section (EWS) scheme.

Many teachers have expressed apprehension over the new funding model, fearing that the burden of the loan will be passed on to the student, the report adds. DU has recently increased its University Development Fee (UDF) by Rs 300 to Rs 900. Additionally, the university has added several additional categories to the fee structure, including University Facilities Fee and a Fund EWS support university.

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