RBI offers relief to poultry firms

The Reserve Bank of India (RBI) has come to the rescue of the poultry industry which has been badly hit by the bird flue outbreak.

The apex bank has announced a moratorium on repayment of the principal and interest by the affected poultry farms.

Besides, the central bank has also recommended reduction in interest rates to lessen the burden on such borrowers.

The RBI has traditionally been announcing such concessions for farmers and industries affected by natural calamities.

A release by the Press Information Bureau (PIB) said that RBI has announced one-time reduction in interest by 4 per cent. Besides, there will be a one-year moratorium on both principal and interest repayment.

However, an RBI spokesperson said the central bank has not finalised the concession scheme yet. "We are in talks with the Indian Banks' Association to work out the package," the spokesperson said.

The PIB release also said, "The period of term loan has been extended by two years and all working capital loans will be converted into working loans."

These loans will not be treated as non-performing assets on banks' books. Both public sector as well as co-operative banks have exposure to the poultry sector.

The banking industry's exposure to poultry industry runs into thousands of crores. "The RBI package may not be enough for the recovery of the industry. The Centre and state governments need to announce more concessions for the revival of the industry," said OP Singh, chief executive officer of Venkateshwara Hatcheries group.

He demanded that procurement price for chicken should be announced for six months. Among other things, the poultry industry also wants a cut in power tariff, common storage facility and waiver of VAT and excise duty on chicken feed.