RBI Against Waiver Of Crop loans In Telangana
The efforts of Telangana Government to convince the
Reserve Bank of India on loan waiver scheme reportedly drew a blank with
the apex bank firm that such schemes will affect the credit repayment
discipline of the borrowers and adversely impact the liquidity of the
banks.
A team of Finance Department officials led by
Chief Secretary Rajeev Sharma in a meeting with RBI officials at Mumbai
on Friday was non committal on giving an assurance on their request for
rescheduling of crop loans of last Kharif and Rabi.
The
RBI officials explained once again why they could not entertain loan
waiver schemes as it would impact the financial health of the banks.
Several bankers expressed concern over the reluctance of the farmers in
repayment and renewal of crop loans and agricultural term loans
anticipating a debt waiver. As a result, it was mentioned in the recent
State level bankers committee meeting that banks were unable to recycle
the funds owing to non-repayment of loans and mounting over dues.
Telangana
officials, according to sources, explained that the outstanding loans
as on March 31 stood at Rs.17,000 crore. But with the RBI ruling out
loan waiver, they urged the apex bank to give some leeway by
rescheduling crop loans to the tune of Rs.9,000 crore keeping in view
crop damaged in 337 mandals due to Phailin cyclone in October 2013.
The
rescheduling of crop loans, they said, would give a breather to the
State and the farmers with a moratorium on repayment for first year and
repayment of loan over a period of four to seven years.
The
expert committee on loan waiver appointed by Andhra Pradesh Government
also had represented to the RBI for its clearance for the loan waiver in
vain. The AP Government was also now pinning its hopes for RBI’s
clearance for rescheduling of crop loans in drought and cyclone affected
575 mandals.
Among others Principal Secretary V.Nagi
Reddy, special secretary K. Ramakrishna Rao and advisor to the
Government G. R. Reddy attended the meeting.