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    Question

    As per RBI norms on agricultural advances, a loan

    granted for long duration crops will be classified as a Non-Performing Asset (NPA) if the instalment of principal or interest remains overdue for:
    A 90 days Correct Answer Incorrect Answer
    B 180 days Correct Answer Incorrect Answer
    C One crop season Correct Answer Incorrect Answer
    D Two crop seasons Correct Answer Incorrect Answer
    E 360 days Correct Answer Incorrect Answer

    Solution

    RBI has set separate norms for agricultural loans: • Short-duration crops (crop season up to 1 year): The loan is treated as NPA if overdue for two crop seasons. • Long-duration crops (crop season longer than 1 year): The loan is treated as NPA if overdue for one crop season. The definition of crop season (i.e., the period up to harvesting) is decided by the State Level Bankers’ Committee (SLBC) for each state. Thus, for long-duration crops, even one missed crop season makes the loan non-performing.

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