Farm Loans Waived In 2 Congress-Ruled States Within Hours, Pressure Builds On Karnataka

Chief Minister HD Kumaraswamy said in his budget in July that loans up to Rs 2 lakh will be waived


Rahul Gandhi declared the Congress wont let Prime Minister Modi sleep until the farm loans were waived.


With newly elected state governments announcing farm loan waivers within hours of taking charge, attention is once again turning to Karnataka where promises were made to relieve the debt burden on thousands of farmers. Both the Congress and the Janata Dal Secular, who have formed a coalition government in the state, had made separate promises to waive farm loans in the run up to the state elections in May. And they reiterated the promise when they formed the government together.

Chief Minister HD Kumaraswamy said in his budget in July that loans up to Rs 2 lakh will be waived. In the budget speech, Mr Kumaraswamy implied that coalition realities might slow him down, but it will happen.

He said, "I had resolved to waive all types of crop loans of farmers taken for agricultural activities within 24 hours of formation of a full-fledged government of our party. However, even though the people of the state have not blessed a single party government, I have been provided with a good opportunity to form a coalition government."

After discussions with government officials, nationalised banks, officers of the cooperative sector, the government has decided to waive all defaulted crop loans made up to December 31 last year in the first stage, he had said.

"To encourage non-defaulting farmers (those who had repaid the loans), I have decided to credit the repaid loan amount -- Rs 25,000 or whichever is less -- I have decided to limit the loan amount to Rs 2 lakh," the chief minister added.

But it took months for the first loan waivers to actually happen. The chief minister held meetings with farmer leaders at the Vidhana Soudha. The heated exchanges there made it clear that the farmers wanted fewer conditions for loan waivers.

In November, farmers attacked the Suvarna Soudha in Belagavi in north Karnataka, demanding remunerative prices for sugarcane but also for the implementation of the loan waiver scheme. This was followed by farmers rallies and protests in capital Bengaluru, in a bid to get the government's attention. Kumaraswamy had another round of meetings with farmers where he urged them maintain peace.

The state government says they plan to cover around 44 lakh farmers at a cost of Rs 48,000 crore. So far, only 800 farmers have received the waiver. This had led to criticism from the BJP which is mocking the whole exercise.

BJP leader Shobha Karandlaje also tweeted: "Unholy govt claims to write off farm loans but farmers are getting attachment notices from banks.. Loan waiver scheme is nothing but a big sham. Nothing more than a deceptive lip sympathy."

The government says paperwork and verification to make sure that those who don't deserve a waiver are kept out take time.

The legislature session is currently on in Belagavi and the state government is on the defensive. This at a time when the Congress at the national level is trying to take the lead on farm loans and party president Rahul Gandhi saying they would not let Prime Minister Modi sleep until the farm loans were waived.

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