Thursday, July 27, 2000,
Chandigarh, India


M A I N   N E W S

Punjab’s loan waived
Tribune News Service

CHANDIGARH, July 26 — At last, the Punjab Government is finally out of its loan problems with the Union Government deciding “not to effect recovery of further instalments of its loan repayment and interest payment on the special term loan granted to Punjab during the period 1984-85 to 1993-94”.

Dr R. Bannerji, Joint Secretary, Department of Expenditure, Ministry of Finance( Union Government) has officially conveyed this to the Accountant General( A and E), Punjab and the Chief Secretary to Punjab Government, Mr R.S. Mann through a letter dated July 24. The copy of the letter was circulated to the mediapersons here this afternoon by the Punjab Government.

The letter says, “A special term loan was granted to Punjab during the period 1984-85 to 1993-94. As per the 10th Finance Commission recommendation, one third of the repayment of principal falling due during 1995-96 on special term loan, amounting to Rs 495.21 crore has been written off. Apart from this, the Government of India has written off unpaid instalments of principal and interest from years 1995-96,1997-98,1998-99 and 1999-2000 amounting to Rs 2917.89 crore.”

“It has now been decided by the Government of India not to effect recovery of further instalment of loan repayment and interest payment on the above special term loan”, says the letter further.

The issuance of the letter by the Union Government, the Punjab Government in an official press note said, “This puts an end to the frequent unfounded doubts emanating from certain quarters regarding the unprecedented success of the Chief Minister, Mr Parkash Singh Badal and the President of the SAD-BJP government in relieving Punjab from its crippling loan burden suffered during the years 1984-1994.

The principal amount due against Punjab from 1984 to 1994 was 5799.92 crore. Mr I.K.Gujral, the then Prime Minister, had announced waiving of the loan in 1997 and the Punjab Government had then claimed that the entire loan of Rs 8500 crore (with interest) had been waived.

However, according to information collected by TNS from its own sources till March 31,2000, Rs 3772 crore (principal amount) of the special term loan was due against Punjab with only Rs 3413.11 crore waived by Mr I.K.Gujral, Mr P.V. Narasimha Rao and the 10th Finance Commission.

For getting the remaining loan of Rs 3772 crore and interest on it waived, the Punjab Government had submitted a fresh memorandum in May this year to the 11th Finance Commission highlighting the decision of the Union Government and the 10th Finance Commission to waive the special term loan to Punjab. Following green signal from the 11th Finance Commission, the Union Government formally conveyed the loan waiver decision to the Punjab Government.

It may be mentioned that Capt Amarinder Singh, President of the PPCC, and other Opposition leaders have often targeted the SAD-BJP government on the issue saying the Badal government was misleading people. So the state government is relieved to have the waiver certificate in hand.Back

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