Naidu likely to impose limit on loan waiver
HYDERABAD: Hard pressed for resources, the AP government has more or less decided to cap loan waiver for farmers at Rs 1 lakh and gold loans at Rs 50,000. As the State has a deficit of over Rs 15,000 crore, Chief Minister N Chandrababu Naidu has been at pains to find a way out to keep his poll promise.
If the loan waiver is limited as it seems likely, the burden on the exchequer will come to about Rs 27,400 crore, including the gold loan component of Rs 5,600 crore. If not, it will go up to Rs 61,000 crore, including gold loan component of Rs 35,000 crore.
The committee of experts, headed by former NABARD chairman A Kotaiah, is mulling options on the way forward and has already made a representation to RBI Governor Raghuram Rajan even as Naidu has sounded the NDA government at the Centre for help.
But there has been no clear response yet from either the RBI or the Centre. The State Level Bankers' Committee, at its recent meeting, has also adopted a resolution urging the RBI to allow them to reschedule crop loans.
According to sources, reschedule could be allowed up to five years or in extreme cases, 10. The first glimmer of hope came when the RBI sought details of the adverse seasonal conditions in the State since 2008 so that it could take a call on whether to permit banks to reschedule the loans.
'The fact that the RBI has sought details shows it may give the green signal,' opined a senior official, adding he was expecting a clear response from the RBI within 10 days.
However, there is a catch here ' the previous government (of the undivided AP) did not seek reschedulement of farm loans within 90 days of notifying drought and flood-hit mandals in Jan this year as is the norm.
Hence, the State cannot do so now. Naidu is lobbying with the Centre to direct the RBI to relax the rule, arguing that the then government was preoccupied with agitations. Though Naidu toyed with the idea of issuing bonds to banks, the Fiscal Responsibility Budget Management Act-2003 is coming in the way.
News Posted: 4 July, 2014
|
