Union Minister of State for Agriculture Parshottam Rupala said the government is not considering any loan waiver scheme for farmers before the general elections, even as pressure mounts on the Central government to roll out a common loan waiver scheme nationally for farmers. The last loan waiver scheme launched by the Central government was in 2008. Covering around 44 million farmers, it cost around 1.3 per cent of the GDP. Since the NDA government came to power at the Centre in 2014, state governments in Andhra Pradesh, Uttar Pradesh, Maharashtra, Karnataka, Rajasthan, Punjab and Tamil Nadu have introduced loan waivers around Rs 1 lakh 83 thousand crore. Of this, Andhra Pradesh had the highest at Rs 43,000 crore and Tamil Nadu the lowest at Rs 5,780 crore.
During the campaign for the recent assembly elections in Madhya Pradesh, Rajasthan and Chhattisgarh, Congress president Rahul Gandhi had promised to waive farmers’ loans in these states within 10 days of coming to power. The Congress won a decisive victory in Chhattisgarh, and it will also form governments in Rajasthan and Madhya Pradesh with the help of smaller parties. The BJP’s loss in these states was mainly attributed to rural distress.
Said Rupala to THE WEEK, ”We are not considering any loan waiver scheme for farmers. There are negative consequences of waiving farm loans. We can, though, look at reducing the interest burden on certain crops. Farmers should know that there are so many welfare schemes that the government of India has planned for them. We have taken steps to bring in transformation in the farming sector. Empowering farmers has always been our priority.”
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On Thursday, in a written reply to Shiv Sena MP Bhavana Patil in Lok Sabha, Rupala said, “Such waivers may impact the credit culture of a state by incentivising the defaulters even if they are in a position to repay the loan.”
Considering a tight fiscal situation in the country, the Union government had made it clear that it will not be a part of any waiver scheme, and that states will have to manage the cost for loan waivers from their funds.
In Rajasthan, where more than 50 per cent of families own agricultural land, the previous BJP government led by Vasundhara Raje had announced a loan waiver in June after protests by farmers. But the Congress alleged it was selective. “Majority of the farmers are out of the ambit of the loan waiver scheme. The conditions of the waiver are so stringent that the final number of beneficiaries would be fewer,” said Sachin Pilot, the Congress president in the state, in June.
Chief minister-designate of Rajasthan Ashok Gehlot said the Congress government in the state will give top priority to the farmers. “But, first, let the confusion over who occupies the chief minister’s chair end. Before that it is not right on my part to comment on what I plan to do in the state,” said Gehlot to THE WEEK. This was before the Congress high command named him as the new chief minister of Rajasthan.
Senior CPI leader D. Raja said the Union government is not sensitive to the farmers’ agony. Said Raja to THE WEEK, “Why is there an agriculture ministry in the first place? It is the duty of the ministry to ensure remunerative prices for the products of the farmers and ensure them a good life.” He said there was no harm in the Union government announcing a loan waiver scheme nationally, and that there should be a one-time settlement on farm loan waiver.
“That should not be a problem for the government. Yesterday, [Nitin] Gadkari was praising Vijay Mallya. He said it was unfair to call Mallya a thief for one loan default. This government is okay with one-time settlements for the industry and corporates, but not for farmers. This is unfair. Narendra Modi talks about doubling farmers’ income every now and then. But nothing is happening at the ground level,” said Raja.
Congress’s working president in Madhya Pradesh Bala Bachchan said the new government in the state will fulfil its promise of waiving off farmers’ loan. “It will be waived in 10 days of the formation of the government. There is no doubt about it,” said Bachchan to THE WEEK. He defeated the BJP candidate in Rajpur constituency by a very close margin of around 900 votes. Bachchan will take oath as minister along with Kamal Nath, who will take oath as chief minister of Madhya Pradesh, on December 17.