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Farmer focus spreads cheer

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The Agriculture sector in Telangana State is characterised by stagnation, low productivity, frequent occurrence of droughts and low level of public and private investment. Infusion of investments is the surest way to enhance agricultural productivity which besides breaking the vicious cycle of rural poverty, would also address the macroeconomic problems. But for decades, farmers have been in distress and the loan waiver scheme announced by the Telangana Rashtra Samithi government was their panacea.

Understanding the plight of farmers in the State, Chief Minister K Chandrashekhar Rao had tactfully initiated agricultural reforms and took the first step towards alleviating their hardships through introduction of one-time waiver of outstanding crop loans up to Rs 1 lakh per farmer family as on March 31, 2014.

The State government repaid the crop loans amounting to Rs 16,124.37 crore benefiting a whopping 35.3 lakh farmers across the State. Though the loan waiver scheme was implemented for farmers in 2008, the Central government had borne the entire amount of Rs 6,000 crore in undivided Andhra Pradesh then. The loan waiver announced by the TRS government was the first time that any State government had successfully implemented the scheme on such a large scale.

“Not many people understand our plight, especially our struggle to repay loans. The State government’s Rs 1 lakh loan waiver was a huge help for us especially after facing drought-like situation followed by notices from banks to repay loans,” says Swamy Inna Reddy, a beneficiary farmer from Mariapur who holds a bank account with SBI of Shabad branch in Rangareddy district.

Though such waivers are nothing new for other States, the Telangana State government was among the first to execute the farm loan waiver scheme in an innovative manner through a staggered payment mode as the State Budget could not handle such a huge financial burden in one go. “The scheme was implemented in four equal instalments from 2014-15 to 2017-18 and an amount of Rs 16,124.37 crores were transferred to the accounts of 35.3 lakh farmers. The modalities of the scheme were that the bankers were made responsible for ensuring the genuineness and integrity of the farmers list,” said C Parthasarathi, Principal Secretary for Agriculture.

Further, revenue officials assisted the bank branches in verification of records and identification of fake Pattadar Pass Books, if any, before release of money to farmers. The Telangana government took the responsibility of paying balance loan amount that would be paid to the bank in prescribed installments. A loan waiver certificate was issued to farmers to ensure that bankers issued fresh loans to them after insuring all crop loans under Crop Insurance Loan Scheme. This was a unique initiative taken by a State government in the entire country.
Teams of senior officers from Punjab and Maharashtra visited the State to learn about the scheme and also modalities adopted for its successful implementation.

The State government also established a monitoring and grievance redress mechanism at mandal, district and State levels, with instructions to settle grievances within 30 days.
Interestingly, both the Telangana Rashtra Samithi (TRS) and the Telugu Desam Party (TDP) went into elections in 2014 promising farm loan waiver to the electorate in the newly-formed Telangana and truncated Andhra Pradesh respectively.

While Telangana government repaid the entire Rs 16,124 crore, the AP repaid only Rs 11,500 crore of an estimated Rs 24,500 crore loan amount obtained by its farmers. The Opposition parties alleged that farmers had borne the interest burden on farm loans waived by the government. However, Chief Minister K Chandrashekhar Rao categorically dismissed these allegations and found them baseless after the government inquired into it. “We have not come across any instance of farmers’ bearing the interest burden. The Telangana Rashtra Samithi government has waived Rs 16,124 crore crop loan and would not deny paying another Rs 400 crore towards interest. If the opposition has such information, let them place it on the floor of the House and we will respond to it,” the Chief Minister announced in the Assembly recently.

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