The Election Commission of India has stalled the loan waiver scheme of the Karnataka government on temporary basis as the model code of conduct is in place now due to upcoming Lok Sabha polls.
EC asked the state government to stop loan waivers for the time being after the government asked for its opinion on the matter, The Hindu reported.
The seven-phase elections will start from April 11. Polling will go on till May 19, while results will be announced on May 23.
Polling in Karnataka will be held on April 18 as well as April 23.
Under the scheme, farmers will be waived off loans of up to Rs 1,00,000 in cooperative banks, while Rs 2,00,000 will be waived off in commercial banks. As per the report, the decision was taken as the scheme would initiate cash transfer to the beneficiaries and could sway voters.
The model code of conduct came into being on March 10, the day election dates were announced. It will go on till May 27.
During the budget on November 2, 2018, the Karnataka government announced Rs 34,000 crore farm loan waiver for close to 17.32 lakh farmers, who took loans of up to Rs 2 lakh and were unable to pay till December 31, 2017.
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After the budget, the state government had also said that all banks will waive off pending farm loans till Rs 2 lakh through a guarantee by the government.