Yogi's crop loan waiver scheme likely to cap at about 4 mn beneficiaries

The flagship crop loan waiver scheme of the Yogi Adityanath government is likely to cap at about 4 million beneficiaries, down by 2.6 million as per previous estimates.

Last year, the Adityanath government had estimated that almost 8.6 million small and marginal farmers would benefit from the scheme, which was pegged to cost the exchequer Rs 360 billion, for which the state had made provisions in the 2017-18 budget.

Later, 6.6 million small and marginal farmers were found eligible under the scheme after weeding out duplication of names in bank records. However, by the end of March 2018, only about 3.6 million farmers were provided benefits totalling about Rs 220 billion. The beneficiaries also comprised about 126,000 farmers, whose bank accounts were re-energised by writing off their bad debts.

A large number of farmers could not benefit owing to various reasons of incomplete forms, technical errors, official laxity etc. To assuage their grievances, the government had allowed another window to farmers to apply afresh and subsequently, more than 1.1 million small and marginal farmers had registered their complaints with the designated web portal.

Recently, Adityanath had directed officials to reopen the portal for another fortnight till June 15 to allow farmers reclaim their benefits.

UP agriculture minister Surya Pratap Shahi told Business Standard on Friday that a total of 4 million farmers would benefit under the scheme. “We have directed district officials to verify the claims of farmers and ensure they are not devoid of loan waivers due to wrong data feeding or technical errors,” he added. This year, the state government has allocated Rs 40 billion for disbursal under the crop loan waiver scheme.

Meanwhile, about 1.1 million farmers had registered their claims, of which about 0.55 million cases had been found ineligible for the benefit owing to multiple entries.

The loan waiver scheme is applicable to farmers, who had taken crop loan during 2015-16. The composite relief comprised projected loan waiver of about Rs 307 billion with the remaining 53 billion aimed at providing succour to another category of farmers by writing off non-performing assets (NPA) accumulated by banks in the agricultural sector. This would make such farmers eligible to take fresh loans.

Last year, the scheme had come under a cloud following media reports that farmers were being given cheques of an amount less than Rs 10.

Of total 23 million farmers in UP, 92.5 per cent or 21.5 million fall in the category of small and marginal segments. At the end of March 2016, total agricultural loan outstanding in UP stood at Rs 1.21 trillion, which increased to Rs 1.30 trillion at the end of March 2017. Thus, the projected crop loan waiver of Rs 307 billion was roughly 25 per cent of a total outstanding agricultural loan of Rs 1.21 trillion incurred during 2015-16.