Centre releases `18k cr for Punjab's wheat purchase

In a relief to Punjab government, the Centre on Wednesday released Rs 17,994.21 crore towards Cash Credit Limit (CCL) for Rabi procurement subject to certain conditions laid down by the Reserve Bank of India.

The Union Finance Ministry and the RBI, in separate letters to the Principal Secretary (Finance), government of Punjab, said the central government had decided to release the CCL immediately in view of the urgent need to procure wheat following early arrival of the grain in the mandis and the assurance of the State Bank of India (SBI), said an official release.

The CCL has been released for the Rabi season, up to the end of April, on the condition that the state government would regularize, at the earliest, the outstanding balance in the food credits account of the Kharif Marketing Season 2016.

The SBI will release funds on submission of Letter of Consent under Article 293(3) of the Indian Constitution, the RBI informed the Punjab government through the letter.

The RBI has directed the state government to ensure that all its food credit accounts are always backed by fully paid stock value as per norms.

The state government would also be required to route all its requests to the Government of India for availing CCL through the state Finance Department, the release said.

The CCL clearance by the central government follows Chief Minister Captain Amarinder Singh's intervention in the matter.

Singh had personally met Union Finance Minister Arun Jaitley on the issue and subsequently followed up through phone calls.