The correct answer is D. All of these.
The Reserve Bank of India (RBI) has imposed restrictions on banks from granting new loans for the purpose of minor irrigation in all three categories of blocks – white, grey and dark. The restrictions were imposed in view of the rising levels of non-performing assets (NPAs) in the sector.
The RBI has directed banks to conduct a detailed review of their exposure to the minor irrigation sector and take appropriate steps to reduce the level of NPAs. Banks have also been asked to put in place a mechanism for monitoring the performance of their loans to the sector on a regular basis.
The restrictions on new lending are expected to help banks in reducing their exposure to the risky sector and improve their asset quality. However, the move is likely to have a negative impact on the farmers who are dependent on minor irrigation for their livelihood.
The RBI has classified the blocks into three categories based on the level of agricultural development. White blocks are those with high levels of agricultural development, grey blocks are those with medium levels of agricultural development, and dark blocks are those with low levels of agricultural development.
The RBI has imposed the following restrictions on banks:
- Banks are not allowed to grant new loans for the purpose of minor irrigation in white blocks.
- Banks are allowed to grant new loans for the purpose of minor irrigation in grey blocks, but the loans should be of a shorter tenor and should be secured by adequate collateral.
- Banks are allowed to grant new loans for the purpose of minor irrigation in dark blocks, but the loans should be of a very short tenor and should be secured by adequate collateral.
The RBI has also directed banks to conduct a detailed review of their exposure to the minor irrigation sector and take appropriate steps to reduce the level of NPAs. Banks have also been asked to put in place a mechanism for monitoring the performance of their loans to the sector on a regular basis.
The restrictions on new lending are expected to help banks in reducing their exposure to the risky sector and improve their asset quality. However, the move is likely to have a negative impact on the farmers who are dependent on minor irrigation for their livelihood.