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Posted on 22 November 2012
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| CURRENT AFFAIRS |
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UTTAR PRADESH |
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Winter bonus: UP govt announces loan waiver for farmers
The loan waiver will only cover farmers who have borrowed from the UP Cooperative Rural Development Bank
Virendra Nath Bhatt
Lucknow
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Photo: Vijay Pandey
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A day ahead of the Winter Session of the Uttar Pradesh Assembly commencing on Friday 23 November, UP chief minister Akhilesh Yadav announced a loan waiver package for the state’s farmers. Akhilesh Yadav made the announcement to mark the occasion of the 74th birthday of his father and Samajwadi Party chief Mulayam Singh Yadav. The SP in its election manifesto for the state Assembly elections held in February-March 2012, had promised to waive loans up to Rs 50,000.
The loan waiver package, however, will only cover farmers, who have borrowed Rs 50,000 from the state government-owned UP Cooperative Rural Development Bank and have repaid at least 10 percent of the principal amount by the end of 31 March, 2012. Under the waiver scheme, the remaining principal amount and the interest stand waived off.
The UP government will provide budgetary support to the bank for meeting the cost of the loan waiver. The loan waiver would entail an additional burden of Rs 1,650 crore on the state exchequer and would benefit 7,20,000 farmers in the state. In the current fiscal budget of 2012-13, the state government had made a provision of Rs 500 crore. The provision for the remaining fund is likely to be made in the supplementary budget to be introduced in the Winter Session of the Assembly.
“We have already made a provision of Rs 500 crore in the budget and the remaining amount will be allocated in the supplementary grants,” Akhilesh Yadav said.
The CM, however, did not give any assurance about whether the farmers who have taken loans from nationalised commercial banks and other financial institutions would be covered by this scheme in future or not. “In our election manifesto we had only assured about the waiver of loan to the farmers of UP cooperative and rural development bank and for those who had mortgaged their land for the borrowing,” he said. “The state government has also decided against the auction of a farmer’s land mortgaged with the bank for the recovery of the outstanding farm loan,” said the CM.
The announcement comes just days before the possibility of the UPA-II government announcing a pension scheme for farmers. Earlier in 2008, the UPA-1 government had waived loans worth over Rs 70,000 crores for 43 million small and marginal farmers.
“The state government has already announced provision of free irrigation to farmers from the canals and state run tube wells and the government will soon announce the State Advisory Price (SAP) for sugarcane for the current cane crushing season 2012-13,” added Akhilesh Yadav.
Virendra Nath Bhatt is a Special Correspondent with Tehelka.
virendranathbhatt@gmail.com
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