With the Karnataka Governmentannouncing a waiver of short term loans of farmers till Rs.50,000 from cooperative banks, the state's Law and Parliamentary Affairs Minister, T.B. Jayachandra, said Wednesday that a certain amount of relief will be provided to farmers through this decision.
Speaking about the loan waiver scheme, Karnataka Chief Minister Siddaramaiah said, "Farmers are in distress". The BJP had repeatedly been demanding farm loan waiver in the State. The move is expected to help about 22.27 lakh farmers who had taken loans from various cooperative banks.
While acknowledging that demand for a loan waiver now has been accentuated perhaps by two successive years of scanty rainfalls, SBI Research warned that due to the adverse effects of farm loan waivers, states like Punjab - which is worst hit due to the move - will make provisions of farm loan waiver in their budgets in multiple years as this will not impact fiscal deficit in one single year.
The state government has made a decision to give a flat debt relief worth Rs 2 lakh to marginal irrespective of their loan amount. The initiative would provide double the relief announced by the states of Uttar Pradesh and Maharashtra, he pointed out.
A loan waiver just before election year should paint the Congress in good light in the state.
Chief Minister Siddaramaiah had been under constant attack from the opposition BJP, which has accused him of "dilly dallying" on loan waiver.
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He added that the Centre will now have to come to the rescue of farmers by waiving the loan obtained by them from nationalised and grameenbanks.
The state govt. move will benefit more than 22 lakh farmers reeling under debt following a severe drought in the state.
The Chief Minister and Congress MLAs also chided BJP over the Centre being non-committal on the issue. He said, "Instead of merely debating the government must act immediately and write off farm loans".
Appreciating the government for understanding farmer's feelings, Opposition Leader Jagadish Shettar said: "Let us together work towards ensuring central assistance to farmers".
Farmers in various parts of the country have been agitating seeking waiver of loans.
"Waiving crop loans of up to Rs 50,000 is not a big achievement". In October 2015, Rahul visited Haveri following farmer suicides in Mandya and north Karnataka.Prodded by Rahul, the CM had announced the waiver of interest on farm loans.
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