Tamil Nadu CM Stalin bats for interim flood relief, 3-month moratorium on loan repayments

He had earlier asked for an interim relief of ₹5,060 crore from the union government to tide over the loss due to the cyclone.

Met with the Central Team to address the severe impact of #CycloneMichaung on Chennai and adjoining districts. We've submitted a comprehensive memorandum seeking Rs 7,033 Cr as interim relief and Rs 12,659 Cr as permanent relief.

The devastation has affected the lives of… pic.twitter.com/DSTOMbeUFB

— M.K.Stalin (@mkstalin) December 14, 2023

Also, the Chief Minister explained the precautionary measures put in place by the state government and the massive efforts taken to rescue the people and provide them relief. Normalcy was restored quickly in the affected areas, he added.

The six-member team under Kunal Satyarthi, Advisor (Policy and Planning), National Disaster Management Authority, visited Chennai, Kancheepuram, Chengalpattu, and Tiruvallur districts and interacted with the officials and residents during its first-hand assessment of the havoc caused due to the influence of Cyclone Michaung on 4 and 5 December.

Three-month moratorium

Stalin also urged the Union government to direct banks to provide borrowers, including MSMEs and traders in Cyclone Michaung-affected northern districts of Tamil Nadu, a three-month moratorium on the repayment of their loans.

The livelihood of about 37 lakh families in Chennai, Chengalpattu, Kancheepuram, and Tiruvallur districts has seen significant disruption and damage to properties, Stalin said in a letter to Union Finance Minister Nirmala Sitharaman.

Although the state government has been able to restore normalcy in their daily lives, the impact on their livelihood still lingers for many. “Small businessmen, traders, and MSME units impacted by the floods are yet to return to their regular economic activities.”

Many of these families and business entities have availed loans for various purposes and they would be finding it impossible to repay their dues in these difficult circumstances.

There is an urgent need to mitigate the burden of immediate debt servicing by relaxing repayment schedules till they come out of this crisis, Stalin urged.

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All term loans to be included

The Chief Minister requested Sitharaman to direct all commercial banks, (including regional rural banks, small finance banks and local area banks), cooperative banks, financial institutions, and non-banking financial companies (including housing finance firms) to provide a moratorium.

It is for 3 months from 1 December 2023 to 29 February 2024 on payment of all instalments in respect of all term loans availed by families and business units in these four districts. Such loans include agricultural term loans, retail and crop loans as well.

“The repayment schedule and all subsequent due dates, as well as the tenor for such loans may be shifted across the board by three months,” he said.

As regards working capital facilities sanctioned in the form of cash credit/overdraft, the lending institutions may be permitted to allow a deferment of three months on payment of interest on all such facilities, outstanding as of 1 December 2023.

Meanwhile, a meeting of bankers and insurance firms was held here by Minister for Micro, Small and Medium Enterprises, TM Anbarasan to lend a helping hand to flood-affected MSMEs.

Chennai and its suburbs were heavily inundated due to the cyclone’s impact.

Related: Vyasarpadi suffers as government support falters in North Chennai

Stalin also (Disclaimer: The headline, subheads, and intro of this report along with the photos may have been reworked by South First. The rest of the content is from a syndicated feed, and has been edited for style.)