In his final budget speech in this government, Finance Minister P Chidambaram provided some relief to students today.
In the vote on account speech, Chidambaram announced a moratorium scheme on interest payment on education loans and said that the move will benefit more than 9 lakh students.
PTI
The Finance Minister allocated Rs 2,600 crore for the education loan moratorium.
In his final budget speech, Chidambaram proposed a moratorium period for all education loans taken up to 31 March, 2009 and outstanding on 31 December, 2013.
He said that the government will take over the liability for outstanding interest, but the borrower would have to pay interest for the period after 1 January, 2014.
"I intend to provide the funds in the current financial year itself. Accordingly, a sum of Rs 2,600 crore will be transferred to Canara Bank, the designated CSIS banker," he added.
The finance minister said the details of the scheme would be announced soon.
Chidambaram also said that the UPA government has focussed on education and the expenditure has increased from Rs 10,145 crore 10 years ago to Rs 79,251 crore now.
"UPA prioritized spreading access to education," he added.
Following the announcement, Fr E Abraham, SJ, Director of XLRI on Interim Budget- 2014 said, "it is heartening to note that expenditure on education has increased almost eight-fold in the last 10 years to reach Rs 79, 251 crores this year."
Fr Abraham said that it is high time that the audit of the education sector is done with more rigor by the Comptroller and Auditor General (CAG) of India and corrective measures be implemented to stem the public funds leakage.
