“Will ‘Nudge’ Centre, NDMA For Measures To Waive Loans Of Wayanad Landslides Victims”: Kerala HC

The Kerala High Court on Thursday stated that while the Reserve Bank of India (RBI) lacks the authority to instruct banks to waive loans for Wayanad landslide victims, the Union government and the National Disaster Management Authority (NDMA) do have the power to intervene in such matters.

The court emphasized the urgent need for compassionate action in the wake of last year’s devastating landslides.

The court noted that Kerala Bank had already waived loans worth ₹5 crore for disaster-hit families and pointed out that other banks with even lesser exposure could follow this example. A division bench of Justices A K Jayasankaran Nambiar and Easwaran S observed, “If Kerala Bank can do it, then other banks can too. It only requires a bit of goading from the NDMA and the Union government.”

Centre Refers To RBI Guidelines

Earlier this week, the central government filed an affidavit in court, referring to the RBI’s Master Directions on Natural Calamities, which permit only the restructuring or rescheduling of loans, not waivers. However, the bench indicated that these rules should not restrict the Centre and NDMA from urging financial institutions to show greater leniency under extraordinary circumstances.

More Into The Case

The High Court also directed the Kerala government to take immediate steps to prevent further disasters ahead of the monsoon season. “Preparatory measures should start before the monsoons. It has already started raining. The NDMA should liaise with the State Disaster Management Authority (SDMA) to avert any possible disaster this year,” the bench said. The court stressed the need to remove debris and implement safety measures to protect vulnerable areas.

The court was hearing a Public Interest Litigation initiated suo motu following the massive landslides that struck the Mundakkai and Chooralmala regions of Wayanad on July 30, 2023. The disaster claimed over 200 lives, left hundreds injured, and 32 people are still missing.

The court’s intervention aims to enhance disaster response, rehabilitation, and future preparedness across Kerala.

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