Loan Moratorium: MK Stalin Writes To CMs Of 12 States To Urge Centre To Delay Loan Repayment

Tamil Nadu Chief Minister M.K. Stalin on Tuesday wrote a letter to Chief Ministers of 12 states to urge the Central government and the Reserve Bank of India (RBI) to provide a loan moratorium to micro, small and medium enterprises (MSME) due to the lockdown this year.

M.K. Stalin - File photo

Chennai: Tamil Nadu Chief Minister M.K. Stalin on Tuesday urged his counterparts in 12 states to seek that the Central government and the Reserve Bank of India (RBI) provide a loan moratorium to micro, small and medium enterprises (MSME) due to the lockdown this year.

In a letter to Chief Ministers of Andhra Pradesh, Bihar, Chhattisgarh, Delhi, Jharkhand, Kerala, Maharashtra, Odisha, Punjab, Rajasthan, Telangana, and West Bengal, he said there is asymmetry in treatment of borrowers, particularly MSME units and small borrowers during the first and second waves of Covid-19.

"In April/May, 2020 when the Government of India had announced the nationwide lockdown, a moratorium was offered on repayment of loans for such borrowers. However, in April-June, 2021 when lockdowns are being imposed, based on local conditions, by the respective states, similar relief to borrowers is not being provided for," Stalin said.

Stating that he has taken up the issue with the Central government, Stalin requested the 12 Chief Ministers to write to both the Union Finance Minister and the Governor, Reserve Bank of India to prevail on them to extend the duration of loan repayment for the first two quarters of 2021-2022 to all small borrowers with outstanding up to Rs 5 crore in view of lockdown the Corona epidemic.

The absence of such relief measures would force many businesses to close and would lead to widespread economic distress. These MSMEs and small businesses are the mainstay of our economy and employment generation, Stalin added.

Stalin also said several Chief Ministers had written to the Central government that it would be the appropriate purchaser of Covid-19 vaccine than the states.

"I am happy that all our collective efforts have been instrumental in convincing the Union Government and the Hon'ble Prime Minister has reversed the earlier policy yesterday," he said.

Several states including Tamil Nadu had floated global tender to purchase Covid-19 vaccines but did not get even a single bid.