The OID Board determines the terms and conditions governing the loans from time to time on the basis of national importance of the project(s) being undertaken by the Oil PSUs and also the current market scenario for determining the rates of interest on OIDB loans.  An independent Project Appraisal Cell has been formed to determine the eligibility of OIDB loan assistance.  For details click Review of interest rates on oidb Loan.

The OID Board has constituted a Standing Committee for review of the interest rates on OIDB loans for different tenors after taking into account the interest rates prevailing in the market and giving its recommendations to the Board.  The Committee meets once in every quarter to review the interest rates on OIDB loans. The formulation for charging interest rates on OIDB loans is as follows :

•               The month end (semi-annualised) interest rates for Government securities having different residual maturities as obtained from Fixed Income Money Market and Derivatives Association of India (FIMMDA) shall be the benchmark rates for computing the interest for different tenures for subsequent month.
•   The corresponding month-end margins of AAA rated Bonds over Government securities available in page INCORP (quote AAA INBMK) of which 50% to be added to the benchmark rate for arriving at the rate of interest.

Discounts
 
As per the recommendations of the Committee, further discounts on rest rates on OIDB loans are also given to certain type of projects such as: -
 

• Projects of Strategic National Importance that have a direct bearing on the energy security of the country are eligible for a  discount of 100 basis points on the effective interest rates. 
• Environmental Improvement projects and projects for special areas, such as, North-East region, J&K state etc. are eligible for a discount of 50 basis points on the effective interest rates.

​Click Here Project Appraisal Cell

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