Debt waiver : Govt seeks RBI help

Tribune News Service

Chandigarh, July 27

A delegation of the state government, led by Finance Minister Manpreet Singh Badal, Principal Chief Secretary Suresh Kumar and Chief Secretary Karan Avtar Singh, met Reserve Bank of India (RBI) Deputy Governors in Mumbai today, seeking their intervention in implementing the debt waiver scheme.

The state government reportedly wanted the RBI to allow nationalised and other banks to offer a one-time settlement of crop loans worth Rs6,000 crore, which the state government intended to take over in its debt waiver scheme.

The state said banks should be allowed to reduce the rate of interest on loans to be repaid by the government.

The RBI officials assured the delegation of looking into the matter.

Besides Punjab, Uttar Pradesh and Maharashtra have announced debt waiver for farmers. Any decision on either offering a one-time settlement or reducing the rate of interest for one state will mean that other states will have to be offered the same relief.

The delegation also met officials of NABARD, seeking refinance institutions’ help in getting refinance for the state’s cooperative banks for the next crop cycle.

As Punjab farmers have stopped repaying loans, cooperative banks have been unable to repay the amount to NABARD, which has threatened not to give further finance to cooperative banks.

With the deadline for repaying Rs3,600-crore loan approaching (July 31), the state government is seeking time.