A debt relief scheme notified by the Goa government recently to partially write off accumulated interest or principal of the bank loans of borrowers affected by mining ban through a one time settlement (OTS) formula has faced a road-block as the scheme is yet to get clerance from the Reserve Bank of India(RBI).
Sources in the State Bank of India (SBI), lead bank, on Saturday recalled while talking to The Hindu that after this proposal was made by the State government at the State Level Bankers Committee (SLBC) meeting held in July, attended by Chief Minister Manohar Parrikar himself, the bankers’ body made it clear that such a write-off of loans had to be endorsed by the RBI. Accordingly, the same was forwarded to the RBI.
A senior banker in the SBI said that the individual banks are free to take their own decisions on OTS of their loans with government subsidy of 35 per cent on a case-to-case basis, where security cover is less than the loan outstanding. In case where loans are covered by sufficient security, why the bankers would opt for settlement, he asked.
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President of Barge Owners’ Association, Atul Jadhav, and Goa Mining People’s Front which represent the loanees facing mining-ban-related crisis over their high NPAs with banks and financial institutions have now demanded that the government has no option but to take over the loans by paying the banks through State’s Apex financial institution like EDC to bail out the nearly 8,000 loanees.
When asked for the response of the GMPF, body representing people affected by nearly two year mining halt, to this development, Advocate Suhaas Naik said on Saturday that it was up to the State government whether to use money that the government got from e-auctioning of the iron ore dumps, to clear these dues to the banks or Chief Minister Manohar Parrikar should use his good offices with the new NDA government at the Centre to get the special mining ban-affected package of Rs.2,500 crores he had sought last year from the erstwhile UPA government.
The State government on Thursday notified the “Debt Relief Scheme for mining affected borrowers of Financial Institutions” to pay off overdue loans against trucks, barges and machinery.
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The State government has made a provision of Rs.400 crores for the scheme. The actual liability could be nearly Rs.1,000 crores.
Through the debt-relief scheme for the mining-ban-affected mining dependents, the government will give 35 per cent subsidy to those of the bank loanees who will clear their bank loans taken before September 2012, i.e., ahead of the mining suspension. Only borrowers with outstanding loans as on June 30, 2014 would be entitled for OTS scheme.