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The prevailing tax rate is 25%. The cost of debt of XYZ it goes to raise...

The prevailing tax rate is 25%. The cost of debt of XYZ it goes to raise debt is 15%. The project is expected to last for 5 years and will need a debt amount of 10 crores. Based on their computation, the project doesn't make sense in the current form. However, the state government is willing to offer this debt at 6%.   XYZ will pay back the principal amount of the debt at the end of the five years. What is the net benefit of this offer (the benefit of new offer minus the benefit of the old scenario) from the government to Firm XYZ?

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