Joshi announces one time loan settlement for border industries

Industries Minister Anil Joshi Friday announced a one-time settlement (OTS) scheme for industries in border districts of Punjab to pay the outstanding loan dues towards Punjab Financial Corporation. Joshi said 409 units are likely to benefit under the scheme and said that the actual amount outstanding in said cases was Rs 625 crores, but under OTS scheme the total amount would be Rs 59 crore. He added that this would mean "financial sacrifice" by PFC to the tune of Rs 566 crore.

Under the scheme, in small loan cases of upto Rs 1 lakh, PFC will recover only the principal outstanding amount minus any payment made towards the loan after April 1, 2003. For loan cases upto Rs 5 lakh, the recoverable amount will not be more than double the loan disbursed. In cases above Rs 5 lakh loan, PFC will charge only six percent simple interest.

Joshi said the policy was valid up to March 27, 2013 and beneficiaries would have to deposit 25 percent of the settlement amount along with their applications. The balance 75 percent is to be deposited within 90 days from the date of settlement without interest or in three quarterly instalments along with 12.5 percent interest per annum from the date of settlement. He said all non performing assets of the PFC of border districts as on March 31, 2012 were eligible to benefit from the scheme.

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