The much-awaited loans to Jaguar Land Rover (JLR) from the European Investment Bank for making low-emission cars finally came through yesterday, with the EIB passing Tata-owned UK car maker's loan application for €366 million. Nissan received €400 million.

Gaydon, Warwickshire-based JLR, employing about 15,000 people at its Merseyside and the West Midlands plants, will receive €366 million while the Japanese car maker will receive €400 million for its European division plants in Sunderland and Spain.

A loan was also approved for a Volkswagen plant in India, which will produce small cars that meet tougher emissions requirements, ahead of their planned launch in major Indian cities from 2010.

However both these loans, a part of the £2.3-billion package approved by the UK government for the UK car industry, (See: Britain unveils £2.3-billion loan for car industry) have yet to be underwritten by the UK government for the two car makers to avail of the loans.

JLR said in a statement: ''We are pleased the EIB has confirmed today that Jaguar Land Rover is eligible for £340 million in loan support. This loan will support our significant investments in environmental technologies that are crucial for the future and part of a total commitment by the business of over £800 million.''

The Japanese car maker said, ''Nissan is very pleased with the approval of the EIB loan, which will support the company's ability to develop and produce innovative products and technologies under the current challenging economic conditions.''

JLR will have to use this loan to invest in greener cars, while Nissan will have to build more fuel-efficient vehicles.

Last wek, Ratan Tata, chairman of Jaguar Land Rover's parent company Tata Motors, had said that JLR would require an additional £500 million loan from the UK government in order to avoid cutting jobs and shuttering plants since the banks in the UK refuse to lend, which the UK government in all probability should make this announcement very soon. (See: Tata's JLR to receive nearly £800 million from UK government)

Business Secretary Lord Mandelson said, ''For JLR, it is a welcome step forward. We are actively engaged in discussions with JLR on this ... and hope to reach a conclusion shortly.''

Although the UK government had announced the auto industry bailout package in January, the lengthy approval procedures at the European Investment Bank have held up the loan disbursals for over two months.

JLR's annual spending on R&D amount £400 million or around a third of the UK's total annual investment in automotive research, in one of the most modern auto research facilities in the UK. Tata had said that without government guarantees, the research and development programmes would suffer a knock-on effect in the future.

With the global economic crisis hammering the auto sector worldwide, the UK car sales had again plummeted in March, a period when car sales register large volumes (See: UK car sales plummet in March) and Society for Motor Manufacturers in the UK, said that the overall new car market is expected to fall to 1.72 million units this year, from 2.13 million in 2008 and 2.4 million in 2007.

The UK car market is expected to decline by 19.3 per cent in 2009, which would be about 4,10,000 units off the 2008 total and almost 6,85,000 units down on 2007.

The EU finance ministers and leaders had increased the EIB lending by €30 billion for 2009-2010 with plan to provide more credit to European auto industry.

EIB has already disbursed loans to European car makers like BMW, Renault and Volvo Trucks since December where Volvo and Scania received 400 million euros each and France's PSA Peugeot-Citroen and Renault, Italy's Fiat and Germany's BMW and Daimler also received €400 million each.