Karnataka Govt. to waive farmer loans upto Rs. 50000

MP farmers
Bharatiya Kisan Union stage a protest on NH-71A in support of Madhya Pradesh farmers
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22 June, 2017

Bowing to pressure from Opposition parties, Chief Minister Siddaramaiah on Wednesday announced waiver of short-term crop loans to the tune of Rs 8,167 crore availed by farmers from co-operative banks in the state.

Once executed, the waiver will directly provide relief to more than 22 lakh farmers reeling under debt due to their inability to pay money to the banks following a severe drought in the state.

"So far the State government has been responsive to farmers' plight through various measures taken in the agriculture sector".

A source close to a cooperative bank said short term political considerations are trumping sound economic dense. Both states have announced farm loan waivers. "The government has not yet issued any letter to the banks about whatever was its decision", said Lomte, who attended the meeting of a group of ministers and the committee in Mumbai on Monday.The farmers' leader said the GR is ambiguous and issued without taking the steering committee into confidence as was decided and following which the farmers withdrew their strike.

Post Maharashtra and UP loan waiver, the company saw marginal improvement in collection rates. It is expected that the loan waiver scheme will benefit more than 22 lakh farmers in the state of Karnataka.

Acknowledging the drought situation in Karnataka as "acute", CM Siddaramaiah said that said that the state government knows that "empowering farmer is empowering Karnataka".

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While making the announcement today, Mr Siddaramaiah demanded that the Centre should now come to the rescue of farmers by waiving the loan obtained from nationalised and grameen banks.

The chief minister, however, had maintained that his government is ready for waiver if the Centre waives farm loans taken from nationalised banks.

Five protesting farmers were shot dead this month in the central state of Madhya Pradesh, which along with Maharashtra is ruled by Modi's Bharatiya Janata Party (BJP).

Siddaramaiah appears to have relented after a nudge from Congress vice-president Rahul Gandhi. "We also give farmers incentives on milk production, as for every litre of milk, we give about Rs. 5 in a year that comes to about Rs. 203,000 crores every year", he added.

The total farm loans in Karnataka stands at over Rs1.16 trillion.

"Waiving crop loans of up to Rs 50,000 is not a big achievement". "Urjit Patel had asked not to go for farm loan waiver, but thousands of crores of loans by corporates were written off".


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