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RBI: No Loan Waiver Nor Rescheduling

RBIRBI Governor Raghuram Rajan is giving hard time to the Cheif Ministers of Andhra Pradesh and Telangana. Chandrababu Naidu and Chandrasekhar Rao made promises to farmers on loan wavier in their election campaign and manifesto. After forming the govermnets in the respectiuve states, both the Cheif Ministers started working on this and when approached the RBI. RBI has told both the state governments that waiving of loans is not possible and only rescheduling of loans may be done.

Recently RBI Governor Raghuram Rajan has clarified that there is no need to waive the farm loans or reschedule them and added RBI does not have structure to implement farm loan waiver. He added saying, “Even if re-scheduling happened not in all districts.” Rajan said commented that farm loan waiver is not a good practice which could disturb the payment structure of loans. Some were not able to pay even though they have capacity and asks to waive loans again and again once we waive the loans.

Raghuram Rajan asked both the state governments, “What is the necessity of re-scheduling?” He said there is no such aroused in two states. There is no much impact of the Pilan toofan which occurred early this year. He added saying, in general, district collectors are supposed to send the report on loss of the crops due to natural calamities, but no collector from the states has sent any sort of report requesting rescheduling of the loans and so RBI have to consider there is not much of damage because of the Pilan.