No farm loan waivers initiatives by govt in last five years: Bhagwat Karad
Parliament was informed on Monday that the government has not given farmers any farm loan waivers in the last five years or this year. Minister of State for Finance Bhagwat Karad said in a written reply to the Lok Sabha that the government has taken a number of steps to help farmers in the country get out of debt.
‘During the last five years and this year, the Government of India has not implemented any farm loan waiver scheme,’ Karad said. Also Read | Govt stated there is no proposal under consideration to waive farmers’ loans.
He was responding to questions from Badruddin Ajmal of the All India United Democratic Front (AIUDF) in the lower house of Parliament about the amount allocated and spent by the government to waive farmer loans over the last five years and this year.
The minister stated that the government has taken numerous steps to help farmers minimize their debt burden, including direct support of ₹ 6,000 per year under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) program and the availability of low-interest agriculture credit.
Farmers can get agricultural credit at a low-interest rate of 7%. For short-term crop loans of up to ₹ 3 lakh, the government has implemented an interest subsidy scheme. Banks that use their own resources are eligible for a 2% annual interest subsidy under the scheme.
‘In addition, the farmers are given an additional 3% incentive for timely repayment of the loan, lowering the effective rate of interest to 4%,’ Karad said.
Aside from these, the RBI has issued instructions for lenders to provide relief measures in areas affected by natural disasters, such as restructuring/rescheduling existing crop and term loans, extending new loans, relaxing security margin norms, and imposing a moratorium, among other things, he said.
‘According to RBI instructions, loans to distressed farmers indebted to non-institutional lenders are an eligible category of farm credit under the priority sector lending program.’ Also Read | Punjab Govt waives farm debt loans of ₹ 590cr for laborers and landless farmers.
‘Pradhan Mantri Fasal Bima Yojana (PMFBY) offers a comprehensive insurance cover against failure of insured crops due to non-avoidable natural risks, thus offering financial support to farmers afflicted crop loss/damage emerging out of unexpected events, stabilizing farmers’ income to ensure their continued participation in farming,’ Karad added.