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Czech state loses Kc70m in settlement of India's debt-Aktualne.cz
(Czech News Agency Via Thomson Dialog NewsEdge)PRAGUE, Jan 15 (CTK) - The Czech state has lost Kc70m in settlement of India's debt so far and it may lose as much as Kc170m, the news server Aktualne.cz has reported.
At the end of December, the Finance Ministry voiced doubts about unblocking of a claim on India and filed a criminal complaint following an internal audit of state claims.
The Czech Finance Ministry lost more than Kc40m in last year's affair involving the exacting of Peruvian debt.
The claim on India dates back to the communist era. After a split of the then Czechoslovakia into the Czech and Slovak Republics on Jan 1, 1993 India owed Kc1.7bn to the Czech Republic.
The governments of the two states agreed that the Indian claim would be used for the purchase of Indian goods only. Contracts were then concluded between the state and private companies which were buying products in India, mainly textile goods, contributing the corresponding amount of money to the state budget.
The debt unblocking proceded without major problems until 1996, according to the ministry's documents, said Aktualne.cz.
The state concluded a contract with textile maker Lanatex based in Ivancice in southern Moravia, and no money was contributed to the state budget. A further company with which the state concluded a contract also stopped paying.
The state did not levy any fines and thus lost Kc70m or more, according to the audit.
The Czech Republic's claim on all companies involved in the debt unblocking amounted to Kc106,899,364 as of June 30, 2005, says the auditors' report. The Czech Republic's claim on India as a state has been settled, the server said referring to the report.
Lanatex board of directors chairman Jiri Sykora admits problems with payments to the state budget. But, he claims the company is ready to meet its obligations. "We repay all our debts," Aktualne.cz quotes Sykora.
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