Notifications

RPCD.NO.PLFS.BC. 96 /05.04.02(DROUGHT)/2002-03

13 May 2003

All Scheduled Commercial Banks
(excluding RRBs)

Dear Sir,

Please refer to our circular RPCD.NO.PLFS.BC. 75/05.04.02(Drought) /2002-03 dated March 11, 2003 forwarding therewith guidelines in respect of Interest Waiver Scheme on Kharif Crop Loans, Drought, 2002.

2. Government of India has, on further examination, advised us that the following criteria may be followed by banks:

1. The banks should finalise the cases of rescheduling of Kharif loans into term loans as per the standard guidelines. Then the amount of first year's interest liability, which is to be waived, is computed out of the deferred amount. It may be pointed out that as per the PM's announcement, the Government has decided to waive first year's deferred liability of interest on Kharif loans. Therefore, farmers not eligible for rescheduling of Kharif loans are also not eligible for waiver.

2. All such eligible farmers residing in a notified drought affected area may be considered as eligible for the benefit. Regarding declaration of a drought affected area, it is suggested that the lowest revenue unit declared as drought affected by the State Government may be considered for this purpose.

There will be a cap on the amount to be waived as equivalent to 20 per cent of the total deferred liability of interest for the first year only.

3. You are requested to incorporate the above criteria in the Interest Waiver Scheme and to take further suitable action accordingly.

4. Please acknowledge receipt.

Yours faithfully,

Sd/-