Maharashtra to announce Rs 5,000 cr farm loan waiver

With the Lok Sabha elections around the corner, the Maharashtra government is set to announce another farm loan waiver package to cover all those who were excluded by the central government’s waiver package.

The latest package is likely to cost between Rs 5,000 crore and Rs 7,000 crore, and benefit 2.7 million farmers. A senior minister in the state cabinet said: “During the monsoon session of the state Assembly, the government had promised a loan waiver package for those not covered by the central government’s Rs 71,000 crore loan waiver scheme. We will be announcing this during the winter session.” However, he refused to divulge the details of the loan waiver package.

The discussion on the Opposition sponsored debate on agriculture distress in the state began today and Chief Minister Ashok Chavan is expected to reply to the discussion on Tuesday. In the course of his reply, he is likely to announce the package, sources said. The high number of farmer suicides from the six cotton growing districts of the Vidarbha region was one of the major reasons that compelled the central government to announce the loan waiver package. However, majority of the farmers from Vidarbha got no benefit from the package as it was given to farmers having less than 5 acres or 2 hectares of land.

Traditionally, Vidarbha has a higher number of landholdings compared with the Western Maharashtra or Konkan regions. Since Vidarbha’s farming is mostly dryland farming, landholding remained large even after the implementation of the Land Ceiling Act. According to the government’s own estimates, out of the 4.5 million farmers in Vidarbha, only 40 per cent received the benefit of farm loan waiver package.

Taking advantage of the resentment among the Vidarbha farmers, Opposition parties Shiv Sena and BJP had organised protests over the last six months, demanding that all farmers should be given benefit of the loan waiver.

The government was put on the back foot by the aggressive posturing of the Opposition.

Many farmers who had paid their dues by taking loans from money lenders or by selling ornaments, were also feeling cheated. “There was a feeling among them that if you default on your loan, instead of punishing you, the government rewards you. So it was necessary that these farmers also get some benefit of their honesty,” said a senior government official.