Punjab CM seeks settlement of Rs 6,000-cr farmers’ loan from Centre

Tribune News Service

New Delhi, July 20

Punjab Chief Minister Capt Amarinder Singh on Thursday sought from the Central Government one-time settlement of the Rs 6,000 crore loans taken by the state’s farmers from the national and private banks.

Such a settlement will benefit 4.5 lakh of the state’s beleaguered farmers, the chief minister told Finance Minister Arun Jaitely at a meeting here.

(Follow The Tribune on Facebook; and Twitter @thetribunechd)

Capt Amarinder sought the minister’s intervention to convert the Rs 6000 crore loan into term loan by giving requisite directions to the Reserve Bank of India (RBI).

Of the total debt of small and marginal farmers waived by the state, Rs 3600 crore relates to loan from cooperatives, with the remaining Rs 6000 crore coming from banks.

These banks, said the chief minister, were giving unethical loans to the farmers, pushing them into a vicious cycle of debt.

Read: Farm loan recoveries drop, banks stop fresh lending in Punjab

He also discussed with the finance minister the issue of settlement of Rs 31,000 crore CCL related debt to ease the cash-crunched state’s financial burden.

He requested Jaitley to set up a committee on the issue.

The chief minister pointed out that the Rs 18,500 crore interest on the Rs 12,500 crore Cash Credit Limit (CCL) legacy gap was exorbitant as it would mean that the state will end up paying Rs 270 crore every month for next 20 years at the cost of welfare schemes of the state.

The chief minister also raised the issue of losses incurred by the state on procurement. He pointed out that of the Rs 40,000 crore procurement undertaken every year the state was suffering a loss of Rs 55,00 crore, including about Rs 3,500 crore on payment of instalments and interest on outstanding CCL debt.

The chief minister also urged the finance minister to waive off GST on langar and prasad given at gurdwaras, temples, churches and mosques.

The finance minister has directed department officials to look into all the issues and coordinate with officials from Punjab Government to resolve them.