The state government also announced to pay the Central government’s interest component on behalf of farmers for the delayed repayment.
The state government on Sunday extended the deadline for repayment of short-term crop loans to June 30 in view of the ongoing second wave of Covid-19 pandemic in the state. The state government also announced to pay the Central government’s interest component on behalf of farmers for the delayed repayment.
An official release from the government stated that Chief Minister Vijay Rupani, for the benefit of farmers, has decided to extend the deadline of crop loan repayment to June 30. “Gujarat government will (also) pay three per interest subvention announced by the Central government and four per cent interest subvention announced by the state government to farmers covered under the cooperative lending system. Thus, the Gujarat government will give pay total seven per cent interest subvention,” the release further said.
“By virtue of this decision, the state government would shoulder additional burden of Rs 16.30 crore otherwise payable by farmers,” it stated.
Cooperative banks in Gujarat charge seven per cent interest on crop loans they advance to farmers from April to July every year.
The Central and state governments give three per cent and four per cent interest subvention respectively to such farmers who repay their crop loans on time or before the loan period of one year.
The state government’s decision means that those farmers who miss their loan repayment date and thereby become ineligible to get the benefit of three per cent interest subvention given by the Central government would also not have to pay any interest on their crop loans as the state government would chip in with that component.
Source: Read Full Article