Himachal Pradesh exploring interest-subvention facilities for borrowers affected by natural calamities: Sukhvinder Singh Sukhu

Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu says the government is exploring interest-subvention facilities for borrowers affected by natural calamities, to provide financial relief & aid recovery efforts. Moratorium period of 12 months & relief to all regulated entities of RBI. Losses so far estimated at Rs 8,660.18 Crores.

Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu on Friday said the State Level Bankers Committee (SLBC) in consultation with the Reserve Bank of India (RBI) would be exploring the possibility of setting up interest-subvention facilities for borrowers affected by natural calamities.

He said the move was expected to provide much-needed financial relief to affected borrowers, aiding them in their recovery efforts as they rebuild their lives and businesses in the wake of the devastating rains that hit the hill State this monsoon season.

“In the wake of hardships faced by borrowers in areas ravaged by unprecedented monsoon rains triggering flash floods and landslides, the State government has taken decisive action to restructure loans. The decision aims to provide relief to those whose economic stability has been severely affected due to the disaster,” he said in Shimla.

He said subsequent to the declaration of the State as a naturally affected area on August 18, 2023, these essential measures had been finalised in consultations with banks. “This initiative focusses on rescheduling all types of existing loans, including those taken for Micro, Small, and Medium Enterprises (MSMEs), retail, and others, excluding advances related to agriculture and allied activities. In accordance with the RBI circular, relief measures for loans extended to agriculture and allied activities will be provided following an assessment of crop losses by the State government,” he said.

He added that to determine eligibility for relief measures, accounts that were not overdue as on June 24, 2023, would qualify for loan-restructuring, and the entire process would be completed within three months from August 18, when the State government had declared the natural calamity.

“For those eligible, a moratorium period will be implemented, allowing a deferment of principal instalment payments for up to 12 months from the date of implementing the need-based restructuring measures, assessed on a case-by-case basis. This relief effort extends to all regulated entities of the RBI, including Scheduled Commercial Banks, Regional Rural Banks, Cooperative Banks [both rural and urban] and Small Finance Banks,” he said.

Since June 24, following the onset of the monsoon in the State, 393 people have lost their lives and 39 people are missing in rain-related incidents as on September 1. The State has seen as many as 163 instances of landslides and there have been 72 incidents of flash floods as well. The total monetary loss so far is pegged at ₹8,660.18 crore, according to government data.