The government passed an executive order for the loan deferment for students in Japan, who went through the ‘Learn and Earn’ programme on March 1. This applies to all the students who are in Japan and those who returned to the country.
The Prime Minister shared this during the third meet the press session recently.
Earlier, some students requested the government to waive off the loan amount. However, the prime minister said, Bhutan has not reached a situation where the government can waive off the loan.
For now, he urged the students to focus on language courses.
“For the class 12 graduates, they need not pay their loan for four years since their language course is for four years. And for university graduates, their language course is for two years, so they will not have to pay their loans for two years. Until they get formally employed, they need not worry about the loan,” Prime Minister Dr Lotay Tshering said.
The prime minister said the question on who will pay the loan interest arises, “banks would not waive of interest because they have also pulled in loans from other financial sources.”
“We have no authority to tell them to waive off interest and the government do not have the financial resources to waive off the interest,” he added.
“What we have decided now is, we will capitalise the interests. So, we will push the interests towards the end of four years and then it will be added to the capital. And when they actually earn through regular employment, they will be able to easily able to pay the loan.”
The students took a loan of about Nu 700, 000 each under the overseas education and skill development loan scheme to study and work in Japan.
Following repeated requests from the students of the programme and their parents, the government decided to look into the possible options of which, loan deferment was one. The government also planned on sending an investigation team to Japan led by the labour minister. But for now, it has been postponed.
At present, there are more than 600 students in Japan under the programme excluding about 100 students who returned to the country last year.
