Nationalised banks asked to give benefit of one-time waiver
Facing backlash for not granting full waiver on farmers’ loans after coming to power, the Congress government in Rajasthan has asked nationalised banks to waive the loans through a one-time scheme. The State government has offered to bear the farmers’ share in the waiver scheme.
The Congress has been asking the NDA government at the Centre to take urgent action on waiving farmers’ loans from nationalised, commercial and land development banks coming under its purview. It has pointed out that the Central government, while it was reluctant to provide relief to farmers, had written off industrialists’ loans worth ₹7.95 lakh crore in its first tenure.
Shortly after being elected to power, the State government had rolled out a loan waiver of ₹14,000 crore, including ₹6,000 crore announced by the previous BJP regime, through which over 20.56 lakh farmers had benefitted. The waiver was enforced for the loans obtained by cultivators from the cooperative banks functioning under the State government.
Chief Minister Ashok Gehlot has sent a proposal to the nationalised banks to bring a one-time loan waiver scheme for the State’s farmers on the lines of a scheme introduced recently by the State Bank of India, which waives agricultural loans, classified as non-performing assets (NPA). While 90% of the loans were waived by the bank, the farmers paid the remaining 10%. Mr. Gehlot said at a meeting of the State Level Bankers’ Committee and the NABARD’s loan seminar here that his the government will now give 10% of the farmers’ share in the scheme and asked the nationalised banks to provide relief to poor farmers.
Farm loan waiver was one of the promises made by the Congress in its manifesto for the 2018 State Assembly election and party leader Rahul Gandhi had announced that all loans of farmers would be waived within 10 days of assuming power. Though the farmers’ loans from nationalised banks were declared as NPAs on November 20, 2018, they are yet to be waived.
Mr. Gehlot had earlier raised the issue with Prime Minister Narendra Modi and pointed out that the NDA’s promise of doubling the income of farmers was not likely to be fulfilled, looking at the government’s policies in the agriculture sector.
Mr. Gehlot also released the State Focus Paper of NABARD for 2022-23 and said the apex regulatory body for the regional rural banks had estimated the potential credit to priority sectors at ₹2.50 lakh crore, which was 7.3% higher than the estimate for last year. He said the banks and financial institutions should target lending to the identified sectors based on the capacity indicated in the document and prepare an annual action plan.
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