Punjab farm loan waiver: Rs.1,500 cr budget outlay too little to fulfil promise

  • Ranjeet Jamwal | Chandigarh

    June 20, 2017 | 05:52 PM
Punjab farm loan waiver

(Photo: Getty Images)

A day after Punjab Chief Minister (CM) Captain Amarinder Singh announced waiver of entire crop loans up to Rs.2 lakh for small and marginal farmers owning land up to 5 acres, provision of just Rs.1,500 crore for this in state's budget has put a question mark on the seriousness of Congress government in fulfilling this key poll promise.

Presenting the new government's maiden budget in the Assembly, finance minister Manpreet Singh Badal proposed an outlay of Rs.1,500 crore "for waiving off the debts of the distressed farmers in Punjab”.

The minister maintained that an expert committee has already been constituted to work on the contours of the detailed farm waiver scheme and the initial budgetary provision Rs.1,500 crore has been made till the time the government receives the report.

"The provision of Rs.1,500 crore in the budget in enough to make the first instalment of farm loans to banks (by the government). We will take over the farm loans and farmer will be free from burden of debts," Badal said while addressing a Press conference after presentation of the budget.

But given the fact that as of March 2017, the total agriculture loans in Punjab are over Rs.85,000 crore, question mark remains over the outlay of Rs.1,500 crore for waiving off the farm loans of over 13-lakh small and marginal farmers.

As per latest figures collected by the State Level Bankers Committee (SLBC Punjab), the number of small and marginal farmers is 17 lakh and they have taken agriculture loans of over Rs.36,000 crore.

But the government maintains only 13 lakh of the small and marginal farmers are eligible for farm loan waiver. Badal maintained that the government will take over only the loans taken for commercial and cooperative banks.

He said that the government will not take over loans extended by private money lenders who provide loans to farmers at short notice without much paper work. Badal, however, said provisions will be made to prevent exploitation of farmers by private money lenders.

Making the farm loan waiver announcement in Assembly on 19 June, the CM, however, said the move would benefit a total of 10.25-lakh farmers, including 8.75-lakh farmers up to 5 acres. The initiative would provide double the relief announced by the states of Uttar Pradesh and Maharashtra, he claimed.

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