Loan Waiver: FM to meet bank heads on May 1

New Delhi, Apr 25: Finance Minister P Chidambaram today said he will meet the heads of all banks on May 1 and ask them to continue normal lending to farmers, pending guidelines on the debt waiver scheme. Reassuring members in the Lok Sabha that the loans would be waived by June 30, as announced in the Budget 2008-09, Mr Chidambaram said the guidelines to the banks to implement the scheme would be formulated by then.

''We will finalise the guidelines in consultations with the RBI and NABARD.... I still have a lot of time,'' he said during the Question Hour. ''If there are still any apprehensions... that the banks are not giving loans pending the guidelines, please do not worry. I have called the chairmen and managing directors of all the banks on May 1, and I will impress upon them that normal lending operations should continue and these guidelines will be issued,'' he said.

Mr Chidambaram said various suggestions had been received for drafting the guidelines.

These broadly relate to:

-- Doing away with the land holding criteria.

-- Inclusion of those farmers in the scheme who have taken loans from moneylenders.

-- varying the land holding criteria taking into account the irrigation status or productivity.

-- Extension of the benefits of the scheme to farmers who have paid their loans in time.

UNI