Bankers’ Committee Chairman Rajendran has leveled scathing criticism against the promise of waiver of loans by the Andhra Pradesh government.
He also clarified that rescheduling of loans will not be possible in the given scenario despite intense public pressure.
In an interview to a leading newspaper, Rajendran once again reiterated that the banks would consider rescheduling the farm loans if the RBI gives specific orders. If that were to happen and the banks opted for rescheduling, he added that the farmers will have to pay 10% interest.
Rajendran made another interesting point during the interview. He said that if the farmers cleared their loans, the banks would issue them clearance certificates which can then be submitted to the government, which will then return their amount. However, for this process to take place, both the farmers and the government should trust each other, he said. If the RBI issues directives, the banks were ready to reschedule loans, said Rajendran.
The Andhra Bank Chairman also wondered how the Andhra Pradesh government could make such huge promises without assessing its financial position.
In the past, the Central government waived Rs 60,000 crore farm loans all over the country. Now, the Andhra Pradesh government has to facilitate waiver of loans adding up to Rs 50,000 crore only in one state, he pointed out.
He said he could not understand how people could be taken in by such false or unattainable promises. He also revealed that the loan burden was creating big trouble for Andhra Bank, SBI and SBH.
In all, it can be inferred that the issue of waiver of loans has become a big headache for the banks too.
