Government on Farm Loans
Government is not going to forgive farm loans
On April 11, the parliament said that the government is not planning to waive off farm loans, but it is going to promulgate some schemes to make it easier for farmers to repay the loans. Some schemes may be subject to change.
When asked about this, the Minister of State for Finance Santosh Kumar Gangwar replied that major initiatives have been taken to reduce the debt burden of the farmers, but there are no loan-forgiving polices under consideration by the government.
Various loan providing agencies have been asked to provide relief measures to compensate for the losses that might be incurred due to natural calamities.
In accordance with National Disaster Management Framework, the government has reduced the crop loss percentage from 50 per cent to 33 percent to avail relief measures fund, which may help farmers not only to restructure their farms but also to apply for fresh loans.
The Department of Agriculture, Cooperative & Farmers’ Welfare provides the farmers crop loans up to 3 lakh rupees at a very low interest of 7 per cent. The 7 per cent of interest is now reduced to 4 percent annum for farmers who repay their short-term loans on time. All this is made possible through the subvention scheme which furnishes then farmers with an extra farm subsidy of 3 per cent, he said.