Fund approved to finance farmers’ loan waiver

March 27th, 2008 - 6:29 pm ICT by admin  

A file-photo of P. Chidambaram

New Delhi, March 27 (IANS) The cabinet Thursday approved a debt relief fund with an initial corpus of Rs.100 billion ($2.5 billion) to reimburse commercial banks for waiving off Rs.600 billion of loans of an estimated 40 million farmers. Approval was also given to the schedule that specifies how much money would be transferred to the fund till 2011-12. “The implementation of the debt waiver and debt relief scheme will be completed by June 30,” said an official statement.

The decision to write off loans of some 30 million small and marginal farmers and 10 million others in distress with larger landholding was announced during the budget speech of Finance Minister P. Chidambaram Feb 29.

“Upon being granted debt waiver, or signing an agreement for debt relief under the one-time settlement, the farmer will be entitled to fresh agriculture loans from the banks in accordance with normal rules,” the statement added.

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