Bhopal: Banks agree to Chief Minister Kamal Nath demand of cuts on non-performing assets

BHOPAL: Chief Minister Kamal Nath has successfully made banks agree to his demand of giving discount to state government on non-performing assets (NPAs). It will go a long way in fulfilling Congress poll promise of farm loan waiver. The state government had convened a meeting of State-Level Bankers Committee (SLBC) on Saturday. The bank representatives attending the meeting agreed to state government’s proposal of discount on NPAs.  Nath personally spoke to chief managing directors (CMDs) of big banks over discount on NPAs. A team led by principal secretary, finance, Anurag Jain was dispatched to Mumbai to make the banks toe the line. The team met key officers of banks and submitted proposal of discount on agriculture loan that had turned into NPA.

Finance department officials held several rounds of talks with commercial banks. After deliberations, the banks agreed to offer 40 to 50% discount on agriculture loans that had turned into NPAs. The bank’s nod would help the state government save more than Rs 3,000 crore. While going for farm loan waiver, the state government had decided to resolve the NPA issue in the end.  Most of the farmers, whose loan have turned into NPAs making them a defaulter, would now be free from debt. As far as farm loan waiver from commercial banks is concerned, there are around 23 lakh accounts. Most of these accounts have turned into NPAs. Nath, while deciding on farm loan waiver, had said that discussions would be held with banks over NPAs. Nath had been commerce minister in the Central government in the past. His personal relations have helped in getting this deal done.