The scheme announced by Finance Minister P Chidambaram in the Union budget had set the deadline of June 30, to implement it. However, differences among various ministries and governmental agencies over whom all should be brought under the ambit of the scheme has caused delay in finalising the guidelines, sources in the government said.
Though Reserve Bank of India (RBI) and National Bank for Agriculture and Rural Development (NABARD) have been assigned the task to prepare guidelines to enable banks to execute the scheme, it is learnt that due to confusion in eligibility criteria, the execution of the scheme may delay further.
“Even if the government issued the guidelines now, it will take at least two to three months for the banks to implement it as it involves a lengthy process,” said a bank official on condition on anonymity.
“As NABARD had just asked about agriculture loans and its outstandings from banks instead of individual account holder’s details, the details of what will be the corpus of the scheme has still not been reached,” said a senior official in the Agriculture Ministry.
The delay would likely affect the farming sector as farmers who are hoping to get fresh loan may not get it in the coming Kharief agriculture season which starts June.
With the pressure on the UPA government mounting to include agriculture-allied sectors such as poultry, fishing, dairy, and increase in the holding limit from existing two hectares to five hectares, the government is also in a quandary whether to consider this demand or announce separate scheme to them, the official said.
According to the announcement made in the budget, loan waiver scheme would benefit around three crore small and marginal farmers owning two hectare of land, while rest of the farmers would avail one time settlement (OTS). This alone would burden the exchequer a whopping sum of Rs 60,000 crore. If the limit of land is increased to five hectare, the burden would be much more, said the official.
Though NABARD was in favour of increasing the limit up to five hectare, some officials in the Finance Ministry were said to have expressed their reservation fearing an increase the fiscal burden on the government, it is learnt.
