According to the budget presented by Finance Minister P. Chidambaram in the Lok Sabha, Rs.2,600 crore will be provided in the current fiscal for payment of outstanding interest liability for the period till December 31, 2013. Nearly nine lakh students stand to benefit from this subsidy scheme on educational loans. "I have noticed a sense of discrimination among students who had borrowed before March 31, 2009, struggled to pay interest during the period of study, and continued to service the loans afterwards. I think they deserve some relief," says Chidambaram in his speech.
He further said that, 10 years ago, only a few thousand students, mostly the well-connected, got education loans claims that the government will take over the liability for outstanding interest till December 31, 2013, however the borrower would have to pay interest for the period after Jan 1, 2014. The minister also announced an allocation of Rs.51,198 crore for the department of school education and literacy, and Rs.16,200 crore for the department of higher education.