Banglore: Karnataka chief minister H D Kumaraswamy on Thursday announced a much-expected farm loan waiver for all defaulting loans up to December 31, 2017.
“I have decided to waive all defaulted crop loans of farmers up to 31 December 2017 in the first stage. Farmers who repaid the loan within time, as an encouragement to the non-defaulting farmers, I have decided to credit the repaid loan amount or Rs 25,000 whichever is less,” Kumaraswamy said while presenting the Congress-JD(S) government’s first budget.
Farm loan waiver had been an election promise of the JD (S). “I have decided to limit the loan amount to Rs 2 lakhs. Due to this crop loan wiaver scheme, farmers will get the benefit of Rs 34,000 crore,” he said.
The chief minister also announced provisions to allow farmers to avail of new loans.
Kumaraswamy faces a difficult task, given the fact that the coordination committee of the coalition government headed by former chief minister Siddaramaiah has decided to continue with the welfare schemes announced by the previous Congress government.
There had been much discussion on the nature of the Budget, with Siddaramaiah calling for a supplementary Budget rather than a fresh on, as he had presented a full-fledged Budget only in March, ahead of the state assembly elections.
According to economist D Rajashekhar, faculty at the Institute for Social and Economic Change, the farm loan waiver is likely to be a token one as the state’s finances might not be able to support the whole waiver envisaged by the JD(S) in its manifesto.