Students are back from Ukraine; what happens to their education loans?
Nearly 1,400 students have outstanding balance of Rs 133 crore, says Centre; they may be eligible for two-year moratorium
After Russia invaded Ukraine in February, more than 18,000 Indian medical students studying in Ukraine were evacuated from the war-torn country and brought back home. It has been over five months and, as the Russia-Ukraine war continues to rage, these Indian medical students face an uncertain future.
There is little clarity on how they will complete their education, since the Indian Medical Council is yet to decide on it. The students have sought the Centre’s help to accommodate them in colleges here, but there are too many procedural issues involved.
Also read: No plan to take medical students from Ukraine in local colleges: Centre
Meanwhile, their student loans continue to be in limbo. Most of these students are from middle-class families who took bank loans to go to Ukraine to pursue a medical education.
Lok Sabha query
Raising this point in the Lok Sabha last week, Chandra Sekhar Sahu (BJD), Girish Bhalchandra Bapat (BJP), Pritam Gopinath Munde (BJP) and Rahul Ramesh Shewale (Shiv Sena) sought to know whether a large number of students have availed education loan for study in Ukraine. They also asked for details on the outstanding balance.
In a written reply, the Minister of State (MoS) in the Union Finance Ministry said 1,387 students had availed of education loans for study in Ukraine with an outstanding balance of Rs 133.38 crore.
The MPs further asked if the Centre had “asked the Indian Banks’ Association (IBA) to assess the impact of the conflict on such outstanding education loans of returnee students; and, if so, the details thereof and the manner in which the government proposes to protect them from the list of defaulters.”
Also read: Why did Indian students stay back in Ukraine? Voices of the ones affected
The MoS in the Finance Ministry said the Centre has asked the IBA to assess the impact of the Ukraine conflict on the outstanding education loans of the returnee students and “initiate stakeholder consultations”. This would typically mean the respective bank employees and the loanees (students/parents) discussing how best the loans can be handled.
Two-year breather
The MoS went on to point out that banks sanction education loans keeping in view their respective board-approved loan policies, RBI instructions and the Model Education Loan Scheme formulated by the IBA. “The model scheme provides that if a student is unable to complete the course within the scheduled time for reasons beyond his/her control, the lender may permit such extension, not exceeding two years, as may be deemed necessary to complete the course.”
According to the IBA, the banks are “inclined to providing an extended moratorium period as per the terms of the loan contract/educational scheme under which the loan has been sanctioned.”
