Hyderabad: Bankers in the state are worried about first signature to be signed by the Chief Minister-designates of Telangana and Andhra Pradesh, K. Chandrasekhar Rao and N. Chandrababu Naidu, waiving off farm loans immediately after assuming office.
It would require a whopping Rs 1,37,763 crore to waive off these loans, of which Andhra Pradesh accounts for Rs 87,600 crore and Telangana Rs 49,564 crore.
At the State-Level Bankers’ Committee (SLBC) meeting held here on Friday, bankers who expressed serious concerns over the waiver, wanted both the governments to implement ‘conditional farm loan waiver’ instead of extending to all farmers as the limited financial resources of new states may not be able to bear such a heavy burden.
Chief secretary P.K. Mohanty, AP chief-secretary-designate I.Y.R. Krishna Rao and SLBC president and CMD of Andhra Bank C.V.R. Rajendran attended the meeting.
Bankers suggested that the governments should work out the modalities on farm loan waiver as the farmers have already stopped repayment of previous loans and are pressuring them for fresh loans for the ensuing kharif-season.
Bankers opined that it would be better if the farm loan waiver is extended to only crop loans and not agriculture-allied loans like dairies, livestock, fisheries, multiple-loans and extend the scheme to only those affected by natural calamities.
However, Mr Mohanty and Mr Krishna Rao assured them that they take the concerns expressed by the bankers to the notice of both the governments before the final decision is taken by the respective governments.
Officials from smaller banks such as Cooperative Banks and Regional Rural Banks said the farm loan waiver scheme would push them into a ‘liquidity crisis’ unlike public sector banks.
They said they cannot disburse loans to farmers for ensuing kharif season unless the state governments release funds toward payment of loan arrears in advance. They also raised doubts over whether the farm loans secured by pledging gold are also eligible for waiver.
SLBC chairman Mr Rajendran said, “It’s better if multiple loans availed by some farmers are exempted from loan waiver scheme. Besides loans on agri-allied activities and gold loans should be exempted. It would be better if farmers from natural calamities-affected mandals alone are considered for the scheme. This would not impose heavy financial burden on state governments."
