Centre preparing biggest-ever agriculture debt relief package

Centre preparing biggest-ever agriculture debt relief package

Mumbai: The Union government is planning the largest farm-loan relief package in the country’s history—totalling at least 32,000 crore—and proposals to this effect will be unveiled when the Union Budget is presented on 29 February.

People familiar with the process of creating the package say it will have several components—from a waiver of interest on some loans to the complete writing off of not just stressed assets (or bad loans) but even those loans that have been rescheduled.

As on 30 March 2007, the exposure of commercial banks to the agriculture sector was 2.3 trillion. The total value of agricultural loans could be to the tune of 3.62 trillion, including loans of cooperative banks and regional rural banks (RRBs).

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