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Farmers' loan waiver

Kashmir Times. Dated: 6/12/2017 11:35:27 PM

Central government's message to states is clear that they have generate their own funds for waiving off farmers' loans

The union finance minister Arun Jaitley's statement that all the states should generate their own funds for waiving off loans of the farmers across the country is a clear message that the NDA-government does not want to help the states. He has cited the Reserve Bank of India (RBI) guidelines, which do not take into consideration waiving off the bad loans unless provisioning is planned and created for overcoming the problem of debts of the public sector banks in the country. His contention that the RBI is in an advanced stage of preparing the list of bad loans of the public sector banks so that a resolution can be found at the earliest has not found favour with the states, which have already announced loan waiver for the farmers. This also includes review of the Non-Performing Assets (NPAs) of the banks that have been pending disposal for the past many years for the reasons best known to those ruling the roost in the corridors of power. Maharashtra and Uttar Pradesh have already announced loan waiver for the farmers, who have been agitating on the issue for the past many weeks and months. In fact, at least half a dozen farmers have been killed in police firing on the protestors in Madhya Pradesh while hundreds of them have committed suicide during the past few years in different states of the country. The MP chief minister, sadly announced fast for restoration of peace in the state but his agriculture minister refused to announce any waiver of loans for the farmers. Same is the fate of farmers in other states of the country, where they have been agitating not only for loan waiver but also demanding relief for the losses caused due to severe drought conditions. The condition of the farmers from Tamil Nadu has been before the entire country and the media for the last few months when they have been holding their protests in New Delhi. This was only in the last few days that some of the farmers have suspended their protests on the assurances of their respective chief ministers. But such steps do not point to a permanent solution of the problems faced by the farmers across the country. The demonetization announced by the NDA-government in November last year has already played havoc with the rural and agriculture economy during the past six months. No remedial measures have been announced by the centre for addressing the slowdown in economy.
Another important aspect of union finance minister's statement is how funds are to be allocated for overcoming the problem of bad loans and debts of the banks. As per the picture painted by Jaitley, none of the public sector should lose the money due to bad debts whether they were availed by the industrial sector, corporate houses or the farmers. In this context, this is to be taken serious note of how provision was made for loan waiver to the extent of Rs 1.43 lakh crores for the corporate houses in his budget presentation for the current financial year. The question rises why no provision was kept for waiving off loans to the extent of Rs 38,000 crore availed by the farmers during the past few years. Now against the question is why discrimination should be meted out to one section of the society in the country. The farming fraternity constitutes about two-third of the population and they contribute in a big way to the state exchequer. The resources of the state exchequer should be used for the welfare of a large section of the population of the country. Now that the farmers are still facing the problem of being turned away by the banks in Uttar Pradesh even after the state government has announced loan waiver for the farmers. This is a repetition of the situation similar to early 1990s when prime minister Vishwanath Pratap Singh announced loan waiver for the farmers but most of the banks refused to follow the guideline until money was was reimbursed to them by the government. Unfortunately, V P Singh government was ousted and new government did not honour the commitment made earlier. Somehow, the farmers rose up in arms and lodged strong protests all across the country and situation turned ugly on a number of occasions. Whatever be the outcome of the steps announced by the states and centre, some resolution has to be found for addressing the difficulties being faced by the farmers in the country.