As per Reserve Bank of India (RBI) guidelines and policy approved by Bank Boards, non-performing loans, including, inter alia, those in respect of which full provisioning has been made on completion of four years are removed from the balance-sheet of the bank concerned by way of write-off. Writing off of loans is done, inter alia, for tax benefit and capital optimization. Borrowers of such written off loans continue to be liable for repayment. Recovery of dues take place on ongoing basis under applicable legal mechanisms. Therefore, write-off does not benefits borrowers.

The details of reduction in Non Performing Asset (NPA) due to write off (including compromise) for agriculture and allied activities during the year 2016-17 and 2017-18 (upto 30.09.2017) in respect of Public Sector Banks as reported by Reserve Bank of India (RBI) is given in Annexure.

At present there is no Loan waiver scheme under implementation by the Union Government. As informed by National Bank for Agriculture and Rural Development (NABARD), during the years 2016 and 2017 some State Governments have announced their own schemes, inter-alia, of waiver of loan of farmers.

The last debt waiver scheme viz; Agricultural Debt Waiver and Debt Relief Scheme, 2008 (ADWDRS, 2008) announced by the Union Government was implemented in the year 2008. The debt waiver portion of the ADWDRS, 2008 was closed by its due date i.e. 30.6.2008, while the debt relief portion of the Scheme was closed on 30.6.2010. The Scheme benefitted 3.73 crore farmers to the extent of ₹ 52,259.86 crore.

Annexure

(Amount in Rupees crore)

Bank/Bank Group Name	Agriculture & Allied Activities- Reduction in NPA- due to write off (including compromise) during
	FY 2016-17	April 01-2017 to Sep 30-2017
ALLAHABAD BANK	442	157
ANDHRA BANK	93	44
BANK OF BARODA	754	282
BANK OF INDIA	121	40
BANK OF MAHARASHTRA	142	13
BHARATIYA MAHILA BANK LTD.
CANARA BANK	484	289
CENTRAL BANK OF INDIA	156	19
CORPORATION BANK	112	58
DENA BANK	1	1
IDBI BANK LIMITED	144	77
INDIAN BANK		75
INDIAN OVERSEAS BANK	33	202
ORIENTAL BANK OF COMMERCE	1	18
PUNJAB AND SIND BANK	5	0
PUNJAB NATIONAL BANK	197	381
SYNDICATE BANK	133	112
UCO BANK	13	34
UNION BANK OF INDIA	56	66
UNITED BANK OF INDIA	120	0
VIJAYA BANK	34	94
STATE BANK OF BIKANER AND JAIPUR	714
STATE BANK OF HYDERABAD	237
STATE BANK OF INDIA	2,905	409
STATE BANK OF MYSORE	157
STATE BANK OF PATIALA	35
STATE BANK OF TRAVANCORE	3
Public Sector Banks	7,091	2,369

This was stated by Shri Rajiv Pratap Shukla, Minister of State for Finance in written reply to a question in Rajya Sabha.

 

Loan write-offs remove agricultural NPAs from bank balance-sheets while borrowers remain liable and recoveries continue. RBI guidelines allow banks to write off agricultural NPAs after provisioning for tax and capital optimisation, but borrowers remain liable and recoveries continue under legal mechanisms. No Union Government loan waiver scheme is currently in implementation; some States announced waiver schemes in 2016-2017. The 2008 Agricultural Debt Waiver and Debt Relief Scheme concluded its waiver and relief components by their scheduled closure dates. The Annexure summarizes reductions in agricultural NPAs due to write-off (including compromise) reported by Public Sector Banks for 2016-17 and April-September 2017.