Goa Chamber of Commerce Appeals for Banking Leniency Towards Mining Borrowers
The Goa Chamber of Commerce and Industry (GCCI) has made a formal appeal to banks across the state, urging them to adopt a more lenient and supportive approach towards borrowers affected by the mining industry's past challenges. This call comes as the mining sector in Goa shows clear signs of revival and renewed growth potential, with operations gradually restarting after a period of stagnation.
Urgent Call for Loan Restructuring and Flexible Terms
Chandrakant Gawas, who heads the logistics committee of the GCCI, emphasized the critical need for financial institutions to rework stressed assets. He highlighted that an estimated Rs 5,000 crore in stressed assets is impacting approximately 1,500 borrowers connected to the mining sector. Gawas urged lenders to restructure existing loans with more flexible repayment terms and to consider offering fresh credit facilities based on realistic production forecasts, rather than pursuing aggressive recovery actions.
"Banks should focus on creating sustainable solutions that support the revival of rural mining communities, rather than opting for asset liquidation," Gawas stated, advocating for amicable resolutions that prioritize long-term economic stability over short-term recoveries.
Mining Sector Revival and Growth Projections
The appeal is underpinned by tangible progress in the mining industry's recovery. Currently, four mining blocks are operational in Goa, with an additional six blocks scheduled to be auctioned in April. Industry projections indicate that iron ore output is expected to exceed 10 million tonnes in the current fiscal year, signaling a robust return to productivity.
This revival is not just about production numbers; it is closely tied to broader economic and employment goals. The phased restart of mining leases is strategically designed to revive employment opportunities in the region, with targets set to significantly boost job creation by 2026.
Government Support Through Debt Relief Schemes
In parallel with the GCCI's banking appeal, the Goa government has extended its Debt Relief Scheme to provide substantial financial support to those affected by the mining downturn. The scheme offers:
- 35% loan subsidies to eligible borrowers.
- 100% interest waivers on outstanding loans.
- Principal waivers of up to 40% for truck owners and 30% for barge owners.
This government initiative aims to alleviate the financial burden on key stakeholders in the mining logistics chain, including truck and barge owners, who have faced significant hardships during the industry's dormant phase.
A Collaborative Path Forward
The combined efforts of the GCCI and the state government highlight a collaborative approach to revitalizing Goa's mining sector. By advocating for banking leniency and implementing supportive policies, stakeholders are working to ensure that the sector's revival translates into tangible benefits for borrowers, employees, and the broader economy. The focus remains on fostering a sustainable recovery that leverages the sector's growth potential while addressing past financial stresses through compassionate and pragmatic solutions.
