Millennium Post

Uphill maha waiver

The tough stand of Maharashtra farmers in the middle of June finally paid off as the government provided them with a series of assurances. The most important of these was the blanket waiver of loans to farmers owning less than five acres of land, with the option of immediately applying for a fresh loan. In a decision ratified by the Cabinet, the Fadnavis government announced a Rs.34000-crore crop loan waiver for the State's marginal farmers under the Chhatrapati Shivaji Maharaj Krushi Sanman Yojana, designed to benefit about 89 lakh farmers.

Those having outstanding loans between April 1, 2012, and June 30, 2016, would be entitled to the waiver. Loans up to Rs.1.5 lakh would be written off immediately, making some 35 lakh farmers debt-free. A one-time settlement scheme was also offered to nine lakh farmers who had debts of over Rs.1.5 lakh. They would be eligible for a waiver of 25 per cent of the outstanding amount or Rs.1.5 lakh, whichever was less.

The scheme would benefit those farmers who had sought to restructure their existing loans but still had arrears as of June 30, 2016. Farmers who had been repaying their loans regularly would be eligible for 25 per cent (of their loan component, up to a maximum of Rs.25000) credited directly to their banks as an incentive for their fiscal management. Even those making their payments in June 2017 would be eligible for this incentive.

The Chief Minister emphasised that the scheme was only for "genuine small farmers in distress" and that those who had an annual income of more than Rs.10 lakh would not be eligible for the scheme. He was emphatic that elected representatives- including those in panchayats, traders who are also farmers, big farmers who paid income tax, and Central and state government employees who had their names on the 7/12 extract (an extract from the district land register maintained by the Revenue Department)- who could show that they were farmers would not be eligible for exemption. Not only that, all ministers and MLAs of the Bharatiya Janata Party (BJP) have also pledged one month's salary to support the government's loan waiver, but where the source of the rest of the funds is not clear. This is certainly the biggest-ever loan waiver in Maharashtra. The Centre had categorically stated that there would be no fiscal help from New Delhi to the states that announced farm loan waivers.
While negotiating with the striking farmers, government representatives had said that the state could not afford to waive loans as it would be at the cost of major infrastructure and other key projects. Even Fadnavis had said that implementing the loan waiver would be "difficult" but he was committed to it "in the interest of farmers." Fadnavis is yet to divulge the source of the money. He did, however, say that writing off debts was not a long-term solution since the whole cycle of accumulating unpaid debts could recur. To guard against this, he said, the State would invest heavily in long-term farm sector security.

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