MUMBAI: A fortnight after the state cabinet deferred a proposal for clearing PM Narendra Modi’s ambitious Rs 97,636-crore Mumbai-Ahmedabad bullet train project, it has emerged that the finance department led by BJP leader Sudhir Mungantiwar has raised objections over the state acting as guarantor for the loan of Rs 79,087 crore being secured from the Japan International Cooperation Agency (JICA) at a nominal interest rate of 0.1%.“Our debt burden has crossed Rs 3.56 lakh crore, and we have secured loans of Rs 65,032 crore for the metro project, public works, irrigation projects and the development plan for drought-prone areas. So it is beyond our capacity to accept the role of guarantor,” said a senior official.“No doubt the rate of interest is nominal, but we will still have to examine the proposal in view of the 50-year repayment period,” the bureaucrat added.On January 4, the proposal for the project was brought before the cabinet but was not taken up for consideration owing to the absence of finance minister Mungantiwar. CM Devendra Fadnavis had then told TOI that a high-level cabinet sub-committee would be formed for in-depth study of the project.A senior bureaucrat said a six-member cabinet sub-committee is being set up to study the report submitted by JICA as well as the project’s financial feasibility. The transport department has proposed a cabinet sub-committee comprising transport minister Diwakar Raote and cabinet members Vinod Tawde, Vishnu Sawara, Eknath Shinde, Ramdas Kadam and minister of state Vijay Deshmukh; however, the CM is yet to approve the proposal.The bureaucrat said the Centre too was not in a position to stand as guarantor as the project was not promoted by a Central Public Sector Undertaking. “If it’s a CPSU project, it is well within the powers of the Central government to take guarantee. But the department of economic affairs has laid down guidelines on guarantee for loans which state that if it’s not a CPSU project, the Centre should not take responsibility,” he said.The bureaucrat pointed out that the state, in collaboration with the ministry of railways, is floating a special purpose vehicle, but as per norms prescribed by the Centre, an SPV is not a Central PSU. “Under such circumstances, particularly in view of lack of clarity, the Centre will have to step in to resolve the issue raised by the state finance department,” he said.