CHENNAI: Cooperative loans to the tune of Rs. 6,866 crore, written off by the State Government, will be returned to cooperative banks over a period of five years with 8 per cent interest.

The Government has also decided to refund honest borrowers who repaid their loan outstanding on or after April 1 this year. The banks will pay them the money after they receive the Government reimbursement.

Jewel loans obtained by farmers for agriculture operations will also be returned along with the jewels pledged.

A government order issued in the first week of this month makes it clear that waiving of loans will not be applicable to bogus and benami borrowers. Similarly, loan availed by mortgaging land with cooperative banks for setting up business ventures and purchasing vehicles will not be eligible under the scheme.

According to official sources here, though 90 per cent of the beneficiaries under the scheme were small and marginal farmers, it was the medium and big landowners who benefited. Nearly 40 per cent of the amount waived went to 10 per cent of the beneficiaries - medium and big landlords. There were instances where big farmers benefited to the tune of more than Rs. 10 lakh.

The officials feel the Government should have fixed a ceiling for waiving the loan. That would have reduced the burden of the banks.

Agriculturists associations are complaining that though the Government has issued loan waiver certificates, many farmers have not received fresh loans. Against the requirement of Rs. 1000 crore, the Government has sanctioned only Rs. 160 crore.

This despite the Government's assurance to various cooperative banks that it will repay Rs. 1,300 crore under the loan waiver scheme in the current financial year itself.

Unions' plea

Cooperative bank employees unions have urged the State Government to reimburse the loan write-off in one instalment instead of five years.

P. Balakrishnan, general secretary of the All-India Cooperative Bank Employees Federation, and T. Tamilarasu, general secretary of the Cooperative Bank Employees Federation, say the cooperative banks can give fresh loans to farmers only if the State Government reimburses the loan amount at the earliest. The financial position of many cooperative banks is bad and they are not in a position to issue fresh loans using their funds.

Printer friendly page  
Send this article to Friends by E-Mail