Finance Minister P Chidambaram said on Thursday he had asked for withdrawal of the SBI circular on stopping loans for purchase of tractor and other farm equipments, as it was poorly worded and not justified.
"That circular was poorly worded and misunderstood. I asked my secretary to advise the bank to withdraw it," he told reporters.
He said loans must be given and recovered but there is a proper method of doing it.
"I don't think that the circular was justified," he said, adding that the best the thing was to withdraw it.
State Bank of India on Wednesday withdrew instructions to its branches advising them to stop fresh loans for purchase of tractors and other farm equipment, since defaults on these had mounted.
Ravi Shankar Prasad, spokesman of Bhartiya Janata Party, had circulated copies of the bank's circular to the newsmen during a press meet on Tuesday. The government did not challenge the authenticity of the document and announced its withdrawal forthwith.
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