 "A farmer channels water to irrigate his wheat field on the outskirts of Ahmedabad. Photo: Reuters")
A whopping Rs 11,000 crore worth of crop loans in Odisha are likely to turn into non-performing assets (NPA) by the end of March 2016 as the state government is inordinately delaying to come out with the notification of the extent of crop loss in Kharif 2015.
According to the report of State Level Bankers' Committee, Rs 11,148.51 crore loan has been extended to farmers as on December 2015 for the Kahrif season when the standing crops were destroyed due to scanty rainfall.
The banks are not insisting on loan repayments as the state government has asked the cooperative and commercial banks to not exert any pressure on farmers for repayment of Kharif loans in the affected areas. The bankers were requested to advance rabi loan to farmers without asking them to repay the kharif loan.
"The due date for repayment of Kharif loan advanced in 2015 is March 31. The advances can be restructured according to RBI guidelines only if the crop loss is more than 33% or more as notified by the state government. But the government is yet to notify the extent of crop loss of the drought areas", said a senior bank official requesting anonymity.
According to guidelines, if the crop loss has been 33% or more, restructuring or rescheduling of existing loan will be required. The repayment period, including the moratorium of the restructured loan, will vary depending on the extent of crop loss.
"From April 1, the entire amount of crop loan advanced will be overdue and after 90 days it will turn NPA. We are yet to receive any notification from the state government despite multiple reminders. Odisha government should realise its adverse impact on the state's economy", said a bank official.
"We are readying the notification and will soon share with the finance department", said a state government official.
In Odisha, 28 out of 30 districts have been affected by drought. As many as 1,535,902 hectares of crop area in 29,176 villages of 3,832 gram panchayats under 235 blocks in 28 districts and 412 wards under 55 urban local bodies have suffered crop damage to the extent of 33% and above. Officials estimate the claims to be settled under crop insurance may cross Rs 1,000 crore, surpassing all previous records.
