Co-operative banks: Loans of farmers with ‘non-performing asset’ accounts to be waived

Cabinet minister Shrikant Sharma. (File/Photo)

The state Cabinet on Monday cleared a proposal to waive the loans of small and marginalised farmers with co-operative banks, for accounts which have been turned into “non-performing assets” (NPA), under a one-time settlement scheme. The move will be part of the state government’s ongoing loan waiver scheme, and will benefit about 12.61 lakh farmers, with Rs 1,893-crore burden on the state exchequer.

Cabinet Minister and spokesperson Sidharth Nath Singh said the loans of 22.68 lakh small and marginalised farmers have been already waived till September this year.

Of them, 96 per cent of farmers had loan amounts between Rs 10,000 and Rs 1 lakh. Unlike the fears expressed by economists, he said, the payment of loans of NPA accounts would mean farmers could apply for fresh loans.
Singh said there are about 15.91 lakh farmers whose accounts have been declared NPA by commercial banks, with a loan amount of Rs 2,506 crore. However, the state government has first decided to focus on clearing loans of NPA accounts with co-operative banks, he added.

The Cabinet minister also said the government would launch the third phase of the scheme from October 23. He said that under the one-time settlement scheme, the government would pay 75 per cent of the loan, while the rest would be borne by the banks themselves. He said the government is trying to ensure that farmers for whom loan waiver had been cleared in initial phases get their due amount before Diwali.

The Cabinet also cleared a proposal to allot mining leases in Sonebhadra, Jhansi, Mahoba and Allahabad to the Public Works Department, National Highway Authority of India, as well as to the Eastern Dedicate Freight Corridor to meet the shortage of sand and gravel for road projects. For these leases, Singh said government agencies would give double royalty to the government, but they would only be allowed to use the mines for government projects, and would not be allowed to sell them in the open market.

Cabinet minister Shrikant Sharma said another scheme to provide infrastructure facilities such as cement concrete (CC) roads, drainage, inter-locking tiles and street lights to minority-dominated areas and slums in the city, which was started in 2012-2013, has been renamed ‘Mukhya Mantri Nagariya Apla Basti Viksit Va Malin Basti Vikas Yojna’. He said 100 per cent funding for this project would done by the government, and that Rs 385 crore has already been set aside for the year 2017-18.

He further said 11 different decisions were taken by the Cabinet, including changes in the pattern of appointment of revenue inspectors, as well as approval to digitize land maps in 70 districts for a cost of Rs 5.21 crore.