Punjab government’s promise for farm loan waiver continued to hit repayment of agriculture loans with non-performing assets (NPAs) of banks in the agriculture sector increasing by Rs 277 crore to Rs 6,611 crore in last quarter (October-December).
As per the latest figures with the State Level Bankers Committee (SLBC), which held its 143rd meeting on Thursday. Outstanding under agriculture loans in the state stand at Rs 83,316 crore.
Of this, NPAs under agriculture are to the tune of Rs 6,611 crore which is 7.93 per cent of the agriculture advances outstanding.
As of 31 March 2017, the NPAs under agriculture stood at Rs 4940. Going by this, the NPAs under agriculture have grown by Rs 1671 crore since March this year. Bankers said though the percentage of NPAs in agriculture sector is not alarming, but the same used to about two per cent till about an year ago.
This increase under agriculture sector loans follows ruling Congress’ promise for total farm loan waiver in the run up to Assembly elections. After forming the government in March, the Amarinder Singh government has, however, come with a partial farm loan waiver of up to Rs 2 lakh for the small and marginal farmers.
Bankers maintain as they hope to benefit from the farm loan waiver scheme, Punjab farmers have stopped making repayment of their crop loans and the recovery scenario is being adversely affected. “Because everyone is expecting to get benefit of the farm loan waiver scheme, even farmers other than small and marginal farmers are not making repayments of their loans,” SLBC (Punjab) convener and Punjab National Bank (PNB) general manager PS Chauhan said.
He said banks have been urging farmers to keep their accounts working in order to get farm loans in future. “We are holding camps with a one-time settlement scheme for farmers. We request them to pay back the loan as the state government scheme will only benefit small and marginal farmers with less than Rs Two lakh loans. And even those who are eligible to the waiver scheme should start paying as the benefits of this scheme will anyway come to them sooner or the later,” Chauhan added.
The Punjab government farm loan scheme would cover 10.25 lakh small and marginal farmers who own farm land up to 5 acres and are having loans up to Rs Two lakh or more.CM Captain Amarinder Singh maintains that full implementation of the scheme would require Rs 9,500 crore and farm loans will be settled with banks in installments in four to five years.