Maha unveils Rs 34K cr loan waiver, 89 lakh farmers to benefit

The BJP-led Maharashtra government today unveiled a mega Rs 34,022-crore farm loan waiver scheme that will see debt of up to Rs 1.5 lakh per farmer being written off.
The scheme will make 40 lakh farmers "debt-free" and provide relief to 49 lakh others, according to the state government.
Making the announcement here, Chief Minister Devendra Fadnavis claimed that it was the "biggest ever" loan waiver scheme announced by any state in the country.
Claiming that the move would make 90 per cent of the distressed farmers in the state debt-free, Fadnavis informed that all BJP ministers and legislators would contribute a month's salary towards the loan waiver.

"This Rs 34,022 crore loan waiver scheme - 'Chhatrapati Shivaji Maharaj Krushi Sanman Yojana' - will benefit total 89 lakh farmers in the state, out of which 40 lakh cultivators will become debt-free," he told reporters here.
Fadnavis, who had been under pressure to bring in a major agrarian relief programme to help farmers hit by falling prices of produce and recurring drought, said the state Cabinet approved the decision today.

"There has been a demand for loan waiver for farmers, who have been severely affected due to continuous drought since 2012. They were not able to get new loans for their crops until previous debt was paid. We have time and again assured that we will help the distressed farmers," he said.

"In the last 2-3 days, we held dialogues with various stake-holders, leaders of political parties, farmer groups, and finally decided to grant the biggest loan waiver given by any state in the country," the chief minister said.
He said although the agriculture loans per household in Maharashtra were almost half as compared to other states, the state government decided to announce the biggest loan waiver scheme.
"The 7/12 land extracts of farmers having loans up to Rs 1.5 lakh will be cleared, thereby making around 40 lakh cultivators debt-free. Farmers, whose crop loan has been restructured from 2012 to 2016 and who are still defaulters as on June 30, 2016, will get incentives up to 25 per cent of the crop loan or Rs 25,000, whichever is less," he said.

He added, "For 6 per cent farmers, the government will bring in an OTS (one-time settlement) scheme, under which those who have debts of Rs 1.5 lakh, will get 25 per cent of the outstanding amount or Rs 1.5 lakh, whichever is less."
According to Fadnavis, although the decision would put a burden on the government, it takes some tough decisions to tide over. "We are aware that a decision of this scale will have a bearing on the fiscal health of the state. To counter this, some tough decisions will have to be taken," he said.
He added that all the ministers, members of the state legislature, Class-I officers, government employees, traders who are eligible to pay Value Added Tax (VAT), those people who are liable to file I-T returns from sources other than agriculture, have been kept out from the loan waiver decision.

He said, "Unlike the last time when the loan waiver was announced (by the Congress-NCP government), we take due diligence to ensure that there is no corruption in this scheme by banks. Banks will be monitored so that they disburse the loan amount to the beneficiaries."
According to the chief minister, the government would tie up with banks to fix a repayment schedule for farmers, who take new loans, on the lines of that done by Andhra Pradesh and Telangana.
In a series of tweets, Fadnavis later said, "This is a historic loan waiver of 34,022 crore! This will benefit over 89,00,000 (89 lakh) farmers of Maharashtra."

"Loans waived are up to the limit of 1.50 lakh and the loans due till 30th June 2016. Not only this, but the farmers who repay loan regularly also get incentives! Such farmers to get 25% relief on paid amount (capped at 25,000)," he tweeted.
In another tweet, Fadnavis said, "90% of the distressed farmers of Maharashtra will be free from debts now onwards with this decision."
Meanwhile, the opposition Congress said that the farm loan waiver was a victory of the unity of farmers and the opposition parties' 'Sangharsh Yatra'. It said the party remains firm on its demand of a "blanket loan waiver" without any conditions.

NCP said it was satisfied with the terms set for the mega loan waiver as the scheme included most points "suggested by party chief Sharad Pawar". It also announced that party leaders would contribute a month's salary for the scheme.
Maharashtra Pradesh Congress Committee (MPCC) chief Ashok Chavan, in a statement issued here, said, "The unity of farmers and Opposition parties forced the government to announce a loan waiver. But the party remains firm on its demand of a blanket loan waiver without any conditions."
On Fadnavis' claim that it was the biggest loan waiver, Chavan said he was misguiding people. "The UPA government at the Centre and the Democratic Front government in Maharashtra in 2008 had announced loan waiver, which is still the biggest loan waiver amount in the history."

"The Congress had been constantly seeking a farm loan waiver, even in the state Legislature. Since the government was not willing to listen, we launched Sangharsh Yatra, which received immense response from farmers. Later, when farmers pressurised the government by going on a strike, attempts were made to create fissures among them," he alleged.
"Since the government has put a condition of Rs 1.5 lakh, the scheme will not completely help those who have taken loans of more than that. Hence, we stand by our demand of a blanket loan waiver," Chavan stated.
"Also, help of Rs 25,000 for farmers who pay their loans regularly is not enough too. It should be increased. The Kharif season has started now and therefore, farmers should be immediately given new loans," Chavan stated.

Senior NCP leader Sunil Tatkare said the party was satisfied with the terms laid out for the mega loan waiver.
"(NCP chief) Sharad Pawar met Chief Minister Fadnavis and Revenue minister Chandrakant Patil yesterday in Delhi. We are satisfied that today's decision of loan waiver has included most points suggested by Pawar," Tatkare said in a statement.
"NCP members of Lok Sabha, Rajya Sabha, Maharashtra Assembly and Council will donate a month's salary towards the loan waiver," he added.
He said the party had suggested that the government's initial decision to waive loans until Rs 1 lakh should be increased to Rs 2 lakh. "As a result, the limit was increased to Rs 1.5 lakh," he said.

"We will keep a tab on the implementation of the scheme. If the government misses out on anything, we will try to bring it to its notice," Tatkare said.
He demanded that the government should immediately form the Agricultural Prices Commission as suggested by the party.
Farmers in the state had launched an agitation on June 1 to press for several demands, including loan waiver. The stir had disrupted supply of vegetables and other essentials to cities, including Mumbai for some days.
The stir was called off on June 11 after the state government gave a firm assurance of bringing a comprehensive scheme to help the debt-pressed farmers.