Andhra Pradesh to ask Reserve Bank of India to reschedule loan for 7 years
As per a letter received from RBI to Andhra, reschedule of loans will cover 572 mandals
By : DC Correspondent
Update: 2014-07-18 04:21 GMT
Hyderabad: The Andhra Pradesh government has decided to request the Reserve Bank of India (RBI) to extend the rescheduled loan period from three years to seven years and also reschedule loans of the last rabi season and gold loans. A letter to this effect will be sent to RBI on Friday when chief secretary I.Y.R. Krishna Rao returns from Delhi, said an official in the finance department. The government will also inform the RBI that the rescheduled amount will be paid by the AP government.
According to a letter received from RBI to the AP government, the reschedule of loans will cover 572 mandals of the 660 mandals which were affected by Phailin cyclone, heavy rains and drought. The rescheduling is confined to only crop loans taken in the kharif season of 2013-14. In the 572 mandals farmers have taken around Rs 20,500 crore including Rs 10,000 gold loans.
According to RBI, rescheduling of crop loans is not applicable to Rs 10,000 crore gold loans and the Rs 1,000 crore crop loans taken by the farmers of 85 mandals which were not affected by cyclone or drought. Unless the state government pays the Rs 1,000 crore, these farmers will not get fresh loans.
Similarly, unless the government repays the Rs 10,000 crore to the banks, the farmers will not get back their gold ornaments. It means the AP government immediately requires Rs 11,000 crore to repay banks loans of farmers to avail of fresh loans as assured by the TDP.
Finance minister Yanamala Ramakrishnudu said the government is considering waiving of Rs 1.5 lakh crop loans and Rs 50,000 gold loans of one person per family. According to the finance department officials, farmers have taken gold loans of Rs 50,000 to Rs 3 lakh each. But the state government is considering waiving Rs 1.5 lakh only whether it was crop loans or gold loans. If the government decides to waive Rs 1.5 lakh the burden will be reduced by only Rs 12,000 crore.
Farmers had availed of a loan of around Rs 16,000 crore from banks in the Rabi season. Most farmers have also taken gold loans. If the government wants to waive that loan as well, then the total financial burden will amount to nearly Rs 30,000 crore.
Speaking to the media on Friday, finance minister Yanamala Ramakrishnudu said that the government will do justice to farmers and also categorically tell the RBI that the rescheduled amount will be paid by the government alone. When asked about the resources, the finance minister said that the government will not only pay the loan, but also allot the amount in the Budget.