Punjab CM announces Farm Loan Waiver Scheme – Release of Funds to Settle Loans of Farmers

Published Date - 06 March 2018 04:40:23 Updated Date - 06 March 2018 04:41:02

The government plans to cover 10.25 lakh farmers in its waiver scheme, and simple calculation says it involves Rs 20,500 crore. The state has 18 lakh farmers. Of the total, therefore, 56% farmers would be covered.

The Punjab government on Monday said it will waive off crop loans of up to Rs2 lakh taken by small and marginal farmers, a move it said will benefit more than a million farmers. The decision follows an election pledge made by the Congress party to farmers, and similar announcements made by the governments of Uttar Pradesh and Maharashtra.

“The initiative would provide double the relief announced by the states of Uttar Pradesh and Maharashtra,” chief minister Amarinder Singh told the state assembly.

According to an official statement from the chief minister’s office, the government will take overall outstanding institutional crop loans of households where a farmer has committed suicide.

The government also said it will raise the compensation to these families from Rs3 lakh to Rs5 lakh. For marginal farmers, the state government will provide a flat relief of Rs2 lakh irrespective of their loan amount, the official statement added.

For non-institutional loans, the government said it has set up a cabinet sub-committee to suggest ways to provide relief to farmers after reviewing the Punjab Settlement of Agriculture Indebtedness Act.

The decision to write off loans of small and marginal farmers holding up to five acres of land is based on an interim report of a committee headed by T. Haque, former head of the commission for agricultural costs and prices.

Amid rising demand for loan waivers in several states, the latest announcement in Punjab follows a Rs36,359 crore farm loan waiver programme announced by the Uttar Pradesh government in April, and Rs30,000 crore waiver announced by Maharashtra in June following massive protests by farmers. Farmers in states like Haryana and Madhya Pradesh are also demanding loan waivers and implementation of the recommendations of the M.S. Swaminathan commission for fixing crop support prices at 50% over the cost of production.

This is the first installment under Punjab Crop loan Waiver Scheme. Under this crop loan waiver scheme, state govt. has to distribute Rs 9,500 crore to benefit around 10.25 small and marginal farmers.

Latest Update – Punjab govt. has officially launched the 1st Phase of Punjab Debt Waiver Scheme on 7th January 2018 at Mansa district in Punjab. This scheme will cover 5.63 lakh farmers in its initial phase

 

In this first installment, loan taken from the nationalized banks are not covered. Punjab govt. makes plan to start disbursing the loan amount to the needy farmers in the state. Furthermore, the first phase (out of total 4 phases) will launch on 7 January 2018.

Punjab Farm Loan Waiver Scheme Funds Release Mechanism

The state govt. starts Punjab Farm Loan Waiver Scheme to provide debt relief of Rs 2 lakh per farmer. In this scheme, all the marginal farmers having less than 2.5 acres of land will get a debt relief of Rs 2 lakh. Moreover, the small farmers having land holding between 2.5 – 5 acres will also get covered and will receive debt relief of up to Rs 2 lakhs. Below are the complete details on the fund release mechanism:-

  • Punjab Crop Loan waiver amount will get released in 4 phases.
  • The first installment of Rs. 2700 crore (out of Rs. 9500) is to be given to the farmers on 7 January 2018.
  • Accordingly, the first installment is only for the farmers availing loans from the co-operative banks.
  • Henceforth, the farmers having debt in the nationalized banks still have to wait and will get covered in the next installment.
 

Punjab state govt. is going to complete its pre-election promise of waiving off loans of the farmers soon. However, the Punjab farmers wants that their entire loan of approximately around Rs 59,621 crore should be waived off.

                                                                    


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