Centre rules out farm loan waivers to states

Finance Minister Arun Jaitley on Thursday ruled out farm loan waivers by the Centre but said states can utilise their own resources in this regard.

He clarified that the Centre will not adopt a selective approach by helping one state and not the others.

"This issue (loan waiver) has cropped up in several states. The Centre has its policies for agriculture sector under which we provide interest subvention and other support. We will continue to give all that," Jaitley said in the Rajya Sabha. "If a state has its own resources and want to go ahead in that direction, it will have to find its resources. The situation where the Centre will help one state and not the others will not arise," he said.

Agriculture Minister Radha Mohan Singh had said that the BJP government in Uttar Pradesh will waive off loans of small and marginal farmers as has been promised in party's state election manifesto in the recent assembly polls.

The Congress had demanded that the government announce a loan waiver for farmers across the country as was done by the UPA in 2006 and not just for Uttar Pradesh where the BJP has returned to power with a major mandate.

Referring to demonetisation, Jaitley said the decision was taken as a measure that was required in the interest of the economy.

On former Finance Minister P Chidambaram's assertion that crime would take place despite demonetisation, he said "crime will contine till humanity exists" and cash facilitate crime.

He said that post-demonetisation, except for two states, all others witnessed increase in VAT collection in December.

Jaitley said only 1-2 per cent people benefit due to tax evasion, but poor will be benefited if the government's revenue increased. He said the government will collect Rs 17 lakh crore in form of direct and indirect taxes this year.

The Finance Minister also discussed various steps taken by the government to check black money. He said his party "reaped political gains" because of the "right" decisions taken by the government. Meanwhile, Agriculture Minister Radha Mohan Singh on Thursday justified increase in the retail milk prices by up to Rs 3/litre by companies like Mother Dairy and Amul, saying that it will benefit farmers whose input cost has gone up.

"There is no system to fix milk price in the country. But, the increase in rates will benefit farmers who are incurring high cost on inputs like feed and fodder," Singh said after the launch of a coffee table book on India's white revolution commemorating golden jubilee year of National Dairy Development Board (NDDB).