The waiver is likely to pose a fiscal challenge for the Maharashtra government. The state cabinet also approved the guidelines and the mechanism for implementing the loan write-off - it apply to farmers who were in debt till June 30, 2016.
Maharashtra farm loan waiver: The state government has announced a farm loan waiver of Rs 34,000 crore on Saturday. The farm loan waiver will write off the loans of 89 lakh farmers in the state. Maharashtra Chief Minister Devendra Fadnavis announced the decision after the state cabinet ratified the loan waiver. The waiver is likely to pose a fiscal challenge for the Maharashtra government. The state cabinet also approved the guidelines and the mechanism for implementing the loan write-off – it apply to farmers who were in debt till June 30, 2016. Here are 5 things to know about the Maharashtra loan waiver:
1) The Rs 34,000 crore loan waiver has been dubbed the Chhatrapati Shivaji Maharaj Krishi Samman Yojna.
2) The loan waiver will completely wipe off the loans of some 40 lakh farmers in Maharashtra and nearly 89 lakh farmers will benefit from the loan waiver, according to sources.
3) Farmers who have been paying their loans will be granted a special incentive package which has been capped at Rs 25,000. Of the 1.36 crore farmers in the state, nearly 80 lakh had been regularly paying their loans.
4) Congress and NCP leaders cautioned that the write-off was not going to help all the 1.36 crore farmers. If the state government had waived off the loans of well to do farmers then the waiver would have come with a price tag of Rs 1.14 lakh crore.
5) Maharashtra’s farm loan waiver of Rs 34,000 crore is the biggest loan waiver by any state government. Previously, the Andhra Pradesh government had doled out a waiver of Rs 20,000 crore, Telangana and Punjab have waived off farm loans worth Rs 10,000 crore and Karnataka had waived off a farm loan worth Rs 8,000 crore