Thiruvananthapuram: In a major relief to farmers across the state, the State-Level Bankers Committee has in principle accepted the government decision to extend the moratorium on farmers' loans for both agriculture and non-agriculture till December 31. The proposal put forward by Chief Minister Pinarayi Vijayan at the SLBC meeting here on Wednesday will be forwarded to the RBI for ratification.
The meeting also decided to propose to the member banks to disburse new loans and accepted the chief minister's demand that the interest of the loans should be fixed at nine percent. The government agreed to pay one year's interest to the banks.
In view of the acute crisis in the agriculture sector following the floods last year, the banks also agreed not to impose the SARFAESI Act (Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002) on the loans for one year. There will not be any recovery proceedings for agricultural and non-agricultural loans taken by farmers during the period. The upper limit for debt relief will be raised from Rs 1 lakh to Rs 2 lakh. The meeting supported the proposal to bring both public sector and commercial banks under the purview of the State Farmers' Debt Relief Commission.
Agriculture Minister V.S. Sunil Kumar later told reporters that the SLBC was positive towards the government's suggestions. No recoveries would be initiated during the period, he said.
The district-level SLBCs will meet to implement the decision. "I will attend the district meeting at Idukki," he added.
A special cabinet meeting on Tuesday had decided to extend moratorium on the loans for one year.
