A COSTLY FACE-SAVER FOR FADNAVIS

As farmers in Maharashtra went on a rampage between June 5 and 9, pouring milk and throwing vegetables on the roads, Chief Minister Devendra Fadnavis was putting in place plans to tackle the crisis. First, he held a midnight discussion with a group of farmers at his official residence, persuading them to withdraw the strike and then declaring that the farmers’ unions had split. Then, he declared the state would announce the largest debt write-off by October 31, creating another rift between farmers’ leaders, with influential ones like Giridhar Patil and Budhajirao Mulik staying away from negotiations.

On June 11, an empowered group of ministers headed by revenue minister Chandrakant Patil announced an immediate loan waiver to 3.1 million farmers with marginal land holdings and an in-principle nod to a blanket waiver to all farmers complying with certain parameters. “We will form a committee of ministers and farmers’ representatives to finalise the parameters. The work will be finished by July 25,” says Patil.

The government has not yet disclosed what these parameters will be. A senior minister says loans up to Rs 1 lakh might be written off, as also loans of farmers who own up to five acres of land, or those who have no other source of income. “It will help poor farmers get loans from banks. It will also ensure that rich farmers do not take advantage of the blanket waiver,” he says.

The move is likely to place a burden of Rs 30,500 crore on the state. To waive loans of all farmers, irrespective of income, debt repaying capacity and land holding, the state will need Rs 1.32 lakh crore, more than its Rs 1.25 lakh crore budget.

Fadnavis has also asked cooperative milk federations to share 70 per cent of their profits with farmers. At present, a milk producing farmer from Ahmednagar gets Rs 18 per litre from the milk federation, which in turn sells a litre in Mumbai for Rs 56. Once the new policy is implemented, the farmer will get Rs 24 per litre.

A relieved Fadnavis says farmers and their welfare will remain integral to his government’s policy. “The loan waiver is another step to reaffirm our commitment to the farmers,” he says.

Loan waivers will likely place a burden of Rs 30,500 crore, which the state can ill afford