Andhra Pradesh Chief Minister Nara Chandra Babu Naidu has spoken to RBI Governor Raghuram Rajan over phone on Wednesday. This has gained significance following AP Government received a communique from RBI executive director Deepali Pant Joshi on Tuesday expressing his dissatisfaction over Government's decision to waive farm loans. Hence, Babu called on RBI Governor and explained the turn of events that led him to make a poll promise to waive of loans.
Chandra Babu has reportedly mentioned the "Agricultural crisis" prevailing in the State for the last 10 years. According to reports, Chandra Babu explained Raghuram Rajan how farmers have been suffering due to increase in cost of seeds, fertilizers and low business and natural calamities that affected their prospects. Babu requested RBI to understand the circumstances and apparently RBI Governor Raghuram Rajan was pleased with Babu's gesture. Chandra Babu has further requested RBI to step-in into the situation and help farmers for the revival of Agricultural Sector in Andhra Pradesh.
Earlier on Tuesday, RBI executive director Deepali Pant Joshi wrote to AP Government, "waiving of loans would demoralise borrowers who are promptly repaying while it encourages defaulters hurting the financial health of banks and thus weaken fiscal discipline." With this, Chandra Babu has once again proved his diplomacy and management skills.
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