State awaits 70% of cash credit for wheat payment

Ruchika M. Khanna

Tribune News Service

Chandigarh, May 2

Punjab has not received 70 per cent of the Rs 17,253 crore sanctioned to it by the RBI for buying wheat from farmers. The latter, a major vote bank of the ruling Shiromani Akali Dal, are still awaiting 40 per cent of their payments for the produce sold in the mandis.

What makes matters worse is that a sanctioned amount of about Rs 11,500 crore – which was to be utilised by the state government for purchasing wheat before April 30 — has now lapsed. With the consortium of 60-odd banks refusing to release this amount, the deadline got over and the state did not get it.

Sources in the government told The Tribune that this issue was taken up by Deputy Chief Minister Sukhbir Singh Badal during his meeting with the Prime Minister in New Delhi today. Sukhbir has reportedly urged the PM to resolve the matter at the earliest.

Though the RBI had sanctioned the cash credit limit (CCL) of Rs 17,253 crore to Punjab on April 20 after the state government deposited Rs 5,000 crore with the banks as payment against the previous loans (taken between 1997 and 2013), the state received just Rs 5,600 crore from the State Bank of India and the Punjab National Bank. Another tranche of Rs 5,100 crore was sanctioned to the state on April 30, but it could withdraw only around Rs 508 crore. The remaining Rs 4,492 crore has lapsed.

Till yesterday, 98.9 lakh metric tonnes of wheat had arrived in the state mandis. Of this, 15 lakh MT have been procured by the FCI.

While the farmers whose produce has been procured by the FCI and private traders have received full payment, others – whose wheat was bought by the state procurement agencies – have been paid only partially. “We have transferred Rs 5,908 crore to the arhtiyas,” said a senior government functionary.

Officials said the banks had initially refused to release the CCL to Punjab in view of the government’s failure to reconcile accounts for foodgrains bought between 1997 and 2013. After the state paid up Rs 5,000 crore received from the FCI to the banks, the latter started releasing the payments. “The banks, however, said they had to take permission from their respective board of directors to make fresh provisioning for Punjab. This took a lot of time and the payments have been held up,” said a senior government official.

He said the RBI was expected to give an extension to the state for receiving the CCL, which would ensure that the balance (Rs11,350 crore) was received within 10 days.