K’taka announces ₹8,100crore farm loan waiver
BENGALURU: Karnataka will waive cooperative bank loans to farmers, becoming on Wednesday the latest state to offer a write-off amid growing farm unrest in the country.
“Loans worth ~8,165 crores will be waived, benefitting 22,27,506 farmers across state,” tweeted chief minister Siddaramaiah. Loans up to ~50,000 taken till June 20 will be waived.
BENGALURU: Karnataka will waive cooperative bank loans to farmers, becoming on Wednesday the latest state to offer a write-off amid growing farm unrest in the country.
“Loans worth ~8,165 crores will be waived, benefitting 22,27,506 farmers across state,” tweeted chief minister Siddaramaiah. Loans up to ~50,000 taken till June 20 will be waived.
The partial waiver is expected to bring relief to farmers in a state reeling under three consecutive years of drought.
Sowing in the previous year was down by about 40%, according to the Karnataka Agricultural Prices Commission.
GC Byyareddy, a member of the Karnataka Prantha Raitha Sangha, a farmer organisation, welcomed the move but said the decision was taken because the government was under pressure after write-offs announced by other states. “According to us, loans from cooperative banks forms only about a fourth of formal credit. So, the major relief will only come if loans from nationalised banks are waived,” he said.
The state’s Congress government said the major proportion of crop loans were from nationalised banks and the chief minister wants the Union government to waive such debts.
Siddaramaiah said in the assembly that Karnataka farmers owed around ~42,000 crore and ~10,736 to nationalised banks and cooperative banks.
“I now challenge the BJP state unit to convince the central government to waive the remaining debts,” he said.The BJP countered that the loan waiver was the result of pressure exerted by the party but the amount fell short of expectations. “We were demanding a waiver of loans up to ~1 lakh,” state BJP chief BS Yeddyurappa said. The move follows UP, Maharashtra and Punjab announcing loan waivers and a violent rural strike demanding debt relief in Madhya Pradesh, which left five farmers dead in police firing in Mandsaur. The outburst of discontent poses a challenge for PM Narendra Modi, who has promised to double farmers’ incomes over the next five years.
Two-thirds of India’s population of 1.3 billion depends on farming for their livelihood, but the sector accounts for just 14% of gross domestic product, reflecting a growing divide between the countryside and increasingly well-off cities.