Finally, Punjab govt to notify farm debt waiver

The government had announced a loan waiver of Rs 10,000 crore for the farmers during the Budget Session of the Assembly (File)

The Punjab government has decided to notify the farm loan waiver. The notification was approved by the state Cabinet during its meeting on Wednesday. Finance Minister Manpreet Singh Badal, while briefing the media after the meeting, said that besides the waiver, the government has also decided to take over the outstanding interest of farmers from April 1 till the date of notification. It would mean an additional burden of Rs 400 crore for the state government.

The government had announced a loan waiver of Rs 10,000 crore for the farmers during the Budget Session of the Assembly. Manpreet said the entire amount would be defrayed to the banks in a phased manner, except for the cooperative credit institutions.

The waiver is being extended following a report by an expert group led by Dr T Haque. It will directly benefit nearly 10.25 lakh farmers in the state, the government said. Crop loans worth Rs 2 lakh of small and marginal farmers, having landholdings of upto 5 acres would be waived off. A relief of Rs 2 lakh would be given to the remaining marginal farmers irrespective of the amount of loan.

Manpreet said the Cabinet has directed Chief Secretary Karan Avtar Singh to write to the Election Commission of India with a plea that farm loan waiver should be allowed to be notified immediately and code of conduct should not come in the way. “We will take a plea that the benefit should be extended to the farmers as soon as possible as the announcement was already made in the Assembly. At the most we can leave the Gurdaspur farmers out of the scheme till the election,” he said.

As per the recommendations of Dr Haque’s report, in the case of a farmer who has taken loans from two separate lending institutions, the first priority shall be given to the cooperative institutions and second to the public sector banks and third to the commercial banks, in that order. The amount eligible for debt relief shall comprise of the outstanding liability under crop loan (principal and interest) as on March 31, 2017. The interest outstanding from April 1, 2017 till date of notification shall be additional. As per data collected from State Level Bankers Committee, there are about 20.22 lakh bank accounts with an outstanding crop loan of Rs 59,621 crore as on March 31, 2017.

It is estimated that about 10.25 lakh farmers will be provided debt relief under this scheme. For this purpose, bank branch-wise lists of eligible small and marginal farmers shall be prepared under the supervision of the Deputy Commissioner of the concerned district. The funds shall be provided to the DCs and each farmer shall be issued a debt relief certificate by the concerned bank branch after crediting the relief amount in his account.