In a recent development, the Union government has informed the Kerala High Court that there will be no loan waivers for the victims of the Wayanad landslides that occurred in July last year. Instead, the affected individuals’ loans will undergo rescheduling or restructuring according to the Reserve Bank of India’s (RBI) Master Directions on Natural Calamities.
The announcement was made in an affidavit submitted by the Union Finance Ministry in response to the High Court’s inquiry regarding the possibility of waiving the loans taken by those affected by the disaster. The affidavit detailed that a special session of the State Level Bankers’ Committee (SLBC) in Kerala took place on August 19 last year, presided over by Chief Minister Pinarayi Vijayan, which concluded that the relief measures would align with the RBI’s guidelines.
These guidelines stipulate that financial relief in the wake of natural calamities should include the restructuring or rescheduling of existing loans, featuring a one-year moratorium on payments, along with the potential provision of fresh loans to support recovery.
The central government’s stance was clarified during a hearing of a Public Interest Litigation (PIL) initiated by the court itself following the catastrophic landslides in the Mundakkai and Chooralmala regions on July 30 last year. These tragic events led to significant devastation, resulting in over 200 fatalities and leaving 32 people missing, with hundreds more injured.
This PIL aims to enhance disaster prevention and management strategies in Kerala, a state prone to natural disasters due to its geographical and climatic conditions. The court’s proactive approach seeks to mitigate future tragedies and ensure better preparedness and swift response to natural calamities.
