State finances in a shambles, MP babus prepare farm loan note for new govt
Bhopal: Madhya Pradesh bureaucrats have prepared a note on farm loan waiver for the new chief minister to consider once he is sworn in on December 17, government officials said on Friday. The bureaucrats had an informal meeting with chief minister-designate Kamal Nath on Thursday, following which they prepared a note offering suggestions on how farm loans can be waived — a key promise of the Congress during its campaign.
According to sources, chief secretary Basant Pratap Singh held a meeting with officers of the agriculture and finance department, and cooperatives to take stock of farm loans in the state. An official, who participated at the meeting, said 4.1 million farmers have an outstanding loan of Rs 56,377 crore. In addition to this, the non-performing assets (NPAS) farm loans are worth Rs 12,000 crore. The total budget size for 2018-19 was Rs 18,366 crore.
Party president Rahul Gandhi had announced that farm loans of up to Rs 2 lakh will be waived within 10 days of the new government. Nath said this will be his top priority after taking over.
Outgoing finance minister Jayant Kumar Malaiya and outgoing agriculture minister Gauri Shankar Bisen said that according to the current fiscal condition of the state, it is impossible to waive off all the loans. “Not just 10 days, we are ready to give them a period of one month to make this possible. If they fail to do so, we will support the farmers in their struggle,” Bisen said.
“Given budgetary constraints, it is not possible to waive all the loans of farmers in one go. One of the suggestions is to waive off loans where farmers are not repaying them and have been declared defaulters. Another suggestion is to first waive off loans taken from cooperative banks,” said an official involved in preparing the note and who did not wish to be named.
Additional chief secretary (ACS), agriculture department PC Meena said, “We have collected data from different banks. We will make a report on it and will present it in the first cabinet meeting of the state government. The final decision will be taken by the government.”
Former head of department of Economics at Devi Ahilya Vishwavidyalaya Ganesh Kawadia said, “I don’t see any way loans worth thousands of crores can be waived in this financial year. According to FRBMA, they can take loan up to a certain limit of the state GDP which comes to around Rs 6,000 to Rs 7,000 crore.”
He pointed out that as per Fiscal Responsibility and Budget Management Act (FRBMA) 2003, the state government has almost reached the limit of its loan taking capacity. However, agriculture expert GS Kaushal said,” The loan taking season for the rabi season is over, so the government has some time in hand to waive off the loans.”
MP Congress media in-charge Shobha Oza said, “We have already initiated the process. The experts are working on this plan. We will definitely fulfil the process within time limit.”
The BJP has warned of an agitation if the new government fails to keep its promise.