On any such repayment being made, the portion of any subsequent instalment which represents interest shall be reduced to such an amount as represents interest on the outstanding principal.

Establishment of sinking fund In the case of loans raised by the Board which are not repayable before the expiration of one year from the date of the loan, the Board shall set apart half-yearly out of its income as a sinking fund a sum sufficient to liquidate the loan within a period which shall not in any case, unless the previous consent of the '[State Government] shall have been obtained, exceed thirty years; but the maximum period shall not in any case exceed sixty years.