No loan waiver for Wayanad landslides victims; only rescheduling, restructuring: Centre tells Kerala HC

Union government informs Kerala High Court that loans of Wayanad landslide victims won't be waived, but rescheduled as per RBI guidelines.

The Union government has told the Kerala High Court that the loans of people affected by the landslides in Wayanad in July 2024 will not be waived. Instead, these will be rescheduled or restructured in accordance with the RBI's Master Directions on Natural Calamities.

The Centre made this submission in an affidavit filed in response to the High Court's query on whether the loans availed by the affected individuals could be waived.

In the affidavit, the Union Finance Ministry stated that a special meeting of the State Level Bankers’ Committee (SLBC) Kerala was held on August 19 last year. The meeting, which was also attended by Chief Minister Pinarayi Vijayan, decided to extend the applicable relief measures in line with the RBI's Master Directions on Natural Calamities.

According to RBI's master directions, in the event of a natural calamity, the financial relief measures to be adopted include the restructuring or rescheduling of existing loans — which would entail a one-year moratorium — and the provision of fresh loans.

The Centre had earlier informed a bench of Justices A.K. Jayasankaran Nambiar and Easwaran S. that the proposed measures were limited to a moratorium and restructuring of loans availed of by the landslide victims.

This submission was made during the hearing of a PIL initiated by the court on its own in the wake of the Wayanad landslides, aimed at improving disaster prevention and management in Kerala.