Interest on loans should be charged after two years: I&C Department proposes Government

SRINAGAR — The Industries and Commerce Department has recommended waiving off the interest to be paid by the traders and industrialists hit by the floods. The government has been asked to waive the interest on the current loans and begin charging it after 2 years and to reduce the interest rate by 4 per cent on new loans advanced by the banks.

State’s Financial Commissioner Industries and Commerce, Khurshid A Ganie, said, “We have submitted the proposal to the government for providing the relief to the traders and industrialists in terms of interest waiver.”

He added that the proposal has been submitted to the Revenue Department, which is the nodal agency for preparing the estimate of losses that have been incurred due to the floods in the state.

“While the part of the interest waiver may be provided by the banks themselves, the state government will assess the burden which it can bear by itself. The cabinet will also take a view over the submission of financial package under which the banks can be paid the money which they offer as an interest concession to the industrialists here. The state is banking largely on Central government support to provide the interest concessions,” he said.

Due to the floods, the business activity in the state has been badly hit, with not only the commercial hub of the city, Lal Chowk, remaining shut for nearly a month, but even the losses have been caused to the industries that run in crores.

President of the Federation Chamber of Industries Kashmir (FCIK), Mohammad Ashraf Mir, said that the industrialists are not in a position to pay the interest on the loan due to the heavy losses suffered here. “We have asked the state government that there should be a moratorium on the payment of loans and the interest incurred on current loans should be paid by the government to the banks.”

He said that since the losses were colossal, they have asked for concessions and have submitted before the government that the shops and industries which have been damaged should also be paid the ex-gratia relief on the pattern of the relief that has been given to the houses damaged in floods.

Officials said that once the loss assessment is complete which has been delayed the state cabinet will meet here to clear the financial package that will be submitted to the Central government. Mir said that for the economy to re-bound, there was a need to provide a waiver in the interest rate to the new entrepreneurs who would set up their units.

“We have asked the government that the interest waiver of 3-4 per cent should be provided on new loans to be advanced to the industrialists here,” he said.

The story first appeared in Greater Kashmir under the byline of Ishfaq Naseem